At present, the COVID-19 is raging all over the world, which will seriously impact the safety of human beings and the development of economy and society. While introducing active anti measures, Australia also launched a stronger tax support bill.
Accelerated depreciation: a total of $3.2 billion has been invested to support corporate investment and short-term economic growth through 15 months of accelerated depreciation incentives (up to June 30, 2021). Enterprises with a turnover of less than a $500 million can deduct the cost of assets by 50% of the assets purchased in that year.
Subsidy for employees employed by SMEs: SMEs with annual gross turnover of less than $50 million and employing employees are eligible for this benefit. From April 28, 2020, eligible companies will receive a subsidy of 50% of their employees' wages and salaries tax after they submit qualified financial statements to the Australian tax authority (ATO), up to a maximum of $25000. Even if the enterprises that meet the requirements are not subject to payroll tax deduction, they can also enjoy a minimum subsidy of $2000.
Subsidies for families: Government pensioners, social security recipients, veterans, charter card owners and other government grant recipients will receive a one-time subsidy of $750. This subsidy is tax-free. The subsidy will begin on March 31.
Local subsidies: the government has allocated a $1 billion to support areas and communities that economy have been greatly affected by the COVID-19, including those heavily dependent on tourism, agriculture and education.
Application for extension of tax declaration: taxpayers affected by the COVID-19 are eligible to apply for extension of tax declaration for a period of up to 4 months, and are exempt from interest or fines, including income tax, goods and services tax, fringe benefits tax and consumption tax. Enterprises that need further delay can choose to repay at low interest rate, and those who choose zero installment payment can ask for refund of any installment from September 2019 to December 2019.
Strengthen tax refund: the tax bureau allows enterprises that declare quarterly to declare on a monthly basis, so as to refund tax faster.
Receiving the COVID-19 subsidy: the government temporarily expands the eligibility of the income subsidy, and establishes a new and time limited subsidy mechanism for the new epidemic situation. The welfare payment is paid out once every two weeks, with an amount of $550 each time. People who are receiving the following welfare items can receive COVID-19 assistance: unemployment allowance, youth allowance, child care allowance, farmer subsidy and special subsidy. Over the next six months, eligible recipients will add another $550 every two weeks on top of the current level.
Benefits assistance: in addition to the $750 grant announced on March 12, 2020, the government will provide a $750 grant to social security and veterans' income grant recipients and eligible card holders, except those eligible for the COVID-19 grant. The second payment will be automatically paid to about 5 million social security groups, veterans and eligible card holders on July 13, 2020, with about half of the beneficiaries being pensioners.
Early pension: individuals with financial difficulties due to the COVID-19 will receive up to $10000 in advance in fiscal year 2019-2020 and $10000 in fiscal year 2020-2021. Eligible individuals can apply for up to a $10000 online pension through mygov before 1 July 2020. From July 1, 2020, a further $10000 pension will be available for the next three months. They do not have to pay tax on the payments they make, and the payments they receive do not affect the payments made by the welfare department or the Veterans Administration.
Temporary reduction of pension minimum withdrawal rate: the government is temporarily reducing the minimum withdrawal requirement for account based pensions and similar products by 50% between 2019-2020 and 2020-2021. This measure will benefit retirees by giving them more flexibility in how to manage their pension assets.
Reduction of social security rate: in addition to the change of deposit interest rate in the first scheme, the government is now reducing the presumed rate of return on welfare benefits by 0.25 percentage point to reflect the recent interest rate reduction measures of the Bank of Australia. As of May 1, 2020, the lower presumed yield is 0.25%, and the upper limit is 2.25%. This change will benefit approximately 900000 income assistance recipients, including old-age pension recipients.
Promoting employer cash flow: the government is now providing $100000 to eligible SMEs instead of non-profit (including charitable) employees with a minimum of $20000. These payments will help businesses cash flow so they can continue to operate, pay rent, electricity and other bills, and retain employees. The employer is entitled to a subsidy equivalent to 100% of the salary and wages withheld (from 50% to 50%), and the maximum subsidy is increased from $25000 to $50000. In addition, the minimum subsidy increased from $2000 to $10000. This amount will be paid from April 28, 2020.
COVID-19 SME guarantee scheme: the government will establish a COVID-19 SME guarantee scheme to support SMEs to obtain working capital and help them survive the impact of COVID-19. Under the plan, the government will guarantee 50% of new loans to SMEs by eligible lenders.
The government's support will enhance the willingness and ability of lenders to provide credit to SMEs, which can provide a $40 billion loan for SMEs. The scheme enables SMEs to obtain credit more quickly. It also complements the Bank of Australia's announcement of existing loans to support small businesses.
Support for the aviation industry: the government has also provided up to a $715 million to Australian Airlines and airports to ensure timely cash flow support in the face of unprecedented disruption of international and domestic air travel.
（Resource Document-issuing agency：Jiangsu Provincial Tax Service, State Taxation Administration、Published date：2020-05-13 10:77 Preferential Tax Policies in Australia During The COVID-19 period、Wolters Kluwer Global Daily Tax News Published date：2020-04-24 Australian Importers Urged To Access COVID-19 GST Supports）
