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States step up aid to small business as fight against coronavirus intensifies

Following on from the federal government, the states are rolling out small business aid to help the most vulnerable fight the economic repercussions of the coronavirus outbreak.

States step up aid to small business as fight against coronavirus intensifies
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  • Maja Garaca Djurdjevic
  • March 17, 2020
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On Monday, Western Australia said it is scrapping all household fees and charges, and introducing relief for small and medium businesses as part of its $607 million stimulus package.

The government is offering a one-off grant of $17,500 to payroll tax paying businesses, with a payroll between $1 million and $4 million, to assist them in managing the impacts of COVID-19.

The McGowan government will also fast-track additional payroll tax relief for small businesses, with the payroll tax threshold increasing to $1 million from 1 July 2020, six months earlier than planned.

The $114 million payroll tax announcement builds on the payroll tax package announced by the government in October. As part of the package announced last year, the payroll threshold increased to $950,000 from 1 January 2020, and was due to increase again to $1 million from 1 January 2021.

In addition, small and medium sized businesses affected by COVID-19 can now apply to defer payment of their 2019-20 payroll tax until 21 July 2020.

The deferral is available to employers who pay $7.5 million or less in Australian taxable wages and have been directly or indirectly impacted by COVID-19, compared with normal operating conditions.

“I urge Western Australians to continue to support local businesses, and each other, as we continue to manage the impacts of the virus,” Mr McGowan said.

"COVID-19 is a constantly evolving situation and the McGowan government stands ready to respond in any way necessary. Further measures to support the state's economy are under consideration and will be rolled out as required."

NSW and Queensland follow

Following on from Western Australia, the NSW government said on Tuesday it is making $2.3 billion available to battle coronavirus, including $1.6 billion dedicated to economic stimulus measures.

A total $450 million will go towards waiving payroll tax for businesses with payrolls of up to $10 million for three months, the state government confirmed. 

The government has also allocated $80 million to scrap a range of fees and charges imposed on small businesses, including bars, cafes, restaurants and tradespeople, and $56 million to bring forward the next round of payroll tax cuts by raising the threshold limit to $1 million in 2020-21. 

"This package works hand-in-hand with the recent moves by the Reserve Bank of Australia and the federal government. It will provide more resources to help slow the spread of this virus and boost treatment for those people in our community who need it most,” said Premier Gladys Berejiklian.

After offering payroll tax deferral at the start of March, the Queensland government has now announced $500 million in loans to support workers in businesses affected by coronavirus.

The Palaszczuk government said it will create a new $500 million loan facility, interest free for the first 12 months, to support businesses to keep Queenslanders in work, and extend the coronavirus payroll tax deferral to all businesses across the state.

Deputy Premier and Treasurer Jackie Trad said that in just two weeks, the initial offer of payroll tax deferral had already been taken up by almost 300 small and medium businesses.

“As the Prime Minister has pointed out, it’s small businesses that are hurting the most, and its them we moved to help first with our initial payroll tax deferral earlier this month,” she said.

“But we are seeing this outbreak is having a devastating impact on all Queensland companies, large and small, so now we will extend the offer of a six-month payroll tax deferral to all affected businesses across the state.”

As with the initial payroll tax deferral offer, the government confirmed that the Office of State Revenue will also work with affected businesses to create repayment plans for the deferred tax liabilities.

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