The Victorian government has developed an unprecedented economic survival package (Economic Survival Plan), which provides more than A$3 billion in support to businesses, employees and communities. This article will focus on the assistance of this plan to enterprises, analyse specific implementation measures, and deliver high-quality information for everyone.
Exemption of JobKeeper Payment expenses
For companies participating in the JobKeeper program (employers must pay at least $1,500 to all eligible employees every two weeks), the “extra payment” paid by the employer to employees is now exempt from payroll tax.
First, payroll tax means that if you are an employer in Victoria and your payroll bill exceeds a certain threshold, you will be liable for payroll tax.
The annual threshold for the period from July 1, 2019 to June 30, 2020 is $650,000, and the monthly threshold is $54,166.
Second, there are generally two cases of “extra payments”:
- Payment to eligible employees who have stopped work: in this case, all $1,500 is “extra”;
- Payments to employees with a daily salary of less than $1,500 every two weeks without the JobKeeper plan: in this case, the difference between the daily salary and the minimum payment of $1,500 is “extra”.
Example: Employee A’s salary is usually $1,200 every two weeks (before tax). Under the JobKeeper program, employees are eligible to receive $1,500 every two weeks. In this case, the tax of $1,200 will be subject to payroll tax, but the additional $300 will be exempt from payroll tax.
However, for employees who earn more than $1,500 every two weeks, their salaries will be subject to payroll tax
At the same time, from March 20, 2020 to September 27, 2020, the payment of eligible JobKeeper payments will also allow employers to waive the payment of work cover premium.
Payroll Tax Refund
Businesses whose taxable wages do not exceed AUD 3 million per year will be exempt from payroll tax for the 2019-20 financial year.
The State Taxation Bureau will directly contact qualified companies to reimburse them for the payroll taxes paid for the current financial year.
Eligible companies must continue to submit the declaration form, but do not need to pay any more in this financial year.
These companies can also postpone the payment of payroll taxes in the first quarter of the 2020-21 financial year.
Liquor Licence Fees Waived
The deferrable liquor license fee for 2020 will be waived. Enterprises that have already paid will be reimbursed.
Regardless of whether the fee is paid to the State Taxation Office or to the Victorian Commission for Gaming and Liquor Regulation. The State Taxation Bureau will be responsible for reimbursement.
Business Support Fund
The A$500 million business support fund will provide a one-time grant of A$10,000 to support small and medium-sized enterprises in the industries most affected. The application for this fund has been closed on June 1, so I will not repeat it here.
Working for Victoria
The Victorian government has provided a 500 million yuan fund to the Working for Victoria initiative to help communities and businesses respond to the coronavirus. This fund is mainly dedicated to providing two-way assistance for job seekers and employers, so that unemployed people can find jobs, and employers can also find suitable employees.
Specifically, Working for Victoria has collaborated with Sidekicker to create an online platform that provides a channel for employers and unemployed people to connect.
Employees can use the platform to provide information about their job preferences, skills and experience, and obtain matching employment opportunities, as well as some online training resources.
Employers can register their talent requirements on the platform and contact candidates who meet their business needs.
At the same time, as part of this plan, a $50 million agricultural workforce program provides specialized assistance to agriculture, food processing, and key food supply chain businesses in three areas: “recruitment support, case management support, and financial support.”
This plan is mainly to provide assistance for the accommodation and transportation of employees to help find suitable people for positions where there are no local job seekers.
Quickly track outstanding supplier invoices
The Victorian government will pay all unpaid supplier invoices within 10 working days to ensure that funds can reach businesses and revitalise the economy more quickly. At the same time, the government also urges the private sector to take the same measures whenever possible.
Freeze fees and fines
The Victorian government will freeze a series of fees to reduce the financial burden on families and support Victorian businesses, workers and families to weather the coronavirus crisis.
All fees and fines will be increased to their pre-freezing levels in July, including driver’s licenses, traffic violations, court penalties, and licensing fees. All fire property levies paid by Victorian families will also be frozen at this year’s collection level.
And the government has announced that it will postpone the planned increase in landfill levy due to the coronavirus pandemic.
Rent Relief for Government building tenants
The government will communicate directly with tenants of government buildings that can apply for rent relief. Private landlords are also encouraged to provide rental relief to help businesses.
Land Tax Deferral
Landowners who own at least one non-residential property and whose total taxable land holdings are less than A$1 million can choose to postpone their 2020 land tax payment until after December 31, 2020.
The State Taxation Bureau will contact all taxpayers who meet this extension requirement.
Support commercial tenants and landlords
For commercial tenants and landlords, a commercial lease relief program provides the following support:
- From March 29, 2020, the eviction of commercial leases due to non-payment of rent by merchants was suspended for six months.
- This merchant needs to be a small and medium-sized enterprise with an annual turnover of less than A$50 million and at least a 30% reduction in turnover due to coronavirus.
At the same time, during this suspension period, rent increases are also frozen:
- The tenant negotiates with the landlord and according to the situation of the new corona virus, to achieve a merchant rent reduction or extension proportional to the merchant’s income reduction.
- Mediation services for commercial tenants and landlords to support fair lease negotiations.
Also, the Victorian government also provides land tax relief to commercial landlords who provide rent relief to their tenants, as long as the tenants meet the conditions of one of the following two categories:
1. For commercial tenants of licensed bars, clubs or restaurants holding general, club-wide or premises liquor licenses:
- At the premises level, their turnover in financial year 2018-19 does not exceed A$50 million, or their expected turnover in financial year 2019-20 is less than A$50 million, and
- Since March 2020, its turnover at the site has decreased by at least 30%.
2. For other commercial tenants:
- Their total annual turnover is up to A$50 million, and
- They are eligible and participate in the JobKeeper program.
Such landlords are eligible for a 25% reduction in the property’s 2020 land tax. At the same time, landowners who are unable to secure tenants due to the corona virus pandemic can also enjoy this relief.
The landlord can also postpone the remaining land tax in 2020 until March 31, 2021. This exemption also applies to landlords in the residential rental category.