COVID-19 State Government Stimulus and support issues available to Small Business

State governments have announced a series of measures in to help small and medium sized businesses stay solvent and to keep their staff employed, during the COVID-19 economic downturn.

What follows is a summary of the various assistance measures announced by State Governments Australia wide.

Recurring themes included payroll tax waivers and deferral, waivers of licence fees, rental relief for commercial businesses renting state properties and various concessions on land tax, plus investment in local projects to keep contractors in business and tradies in working.

Another trend is interest-free loans, reductions in payment times for small businesses fulfilling government contracts and advice and mentoring services.

The New South Wales state government unveiled its first stimulus package on March 17. On March 27, it updated its policy, expanding the reach of existing measures and pledging $750 million to creating a new 'Working for NSW' fund.

Payroll tax

New South Wales has waived payroll tax for the next three months, until the end of the financial year.

The waiver is available for businesses with payroll of up to $10 million and is expected to be applied automatically. Those businesses will also be given a three-month deferral on payment of payroll tax.

Businesses with payrolls of $10 million or more, will be able to defer payment of their payroll tax for six months.

The state is also bringing the next round of payroll tax cuts forward, meaning the payroll tax threshold will rise to $1 million in the financial year 2020-21.

Fees waived for Businesses operating in Sectors of the Economy that are Worst Hit

The NSW state government is scrapping fees and charges for businesses in sectors like bars, cafes, restaurants and trades.

The total allocated for this measure is $80 million, but it is not yet clear exactly which fees will be waived, or for how long.

The measure will be administered through Service NSW, and more details are expected to be announced soon.

Gaming tax payments will be deferred for clubs, pubs and hotels for six months, as well as lotteries subject to businesses using those funds to retain staff.

The parking space levy will also be deferred for six months.

Deferred Rental on Commercial Tenancies

The government will defer commercial rent payments on government properties for businesses will less than 20 employees.

Investment in local projects

The NSW Government initially announced $250 million to spend on fast-tracking the maintenance of public assets, including social housing and fencing, as well as $500 million to bring forward capital works and maintenance.

The treasurer confirmed that the government would seek to provide opportunities "for businesses of all sizes," and to create employment.

The NSW government has also pledged $250 million to employ additional cleaning staff for public infrastructure, including public transport assets, schools and public buildings.

Payroll tax refunds

The Victorian governments has announced a $1.7 billion package under the banner of "Economic Survival Package to Support Businesses and Jobs". It includes a permanent refunds of payroll tax for small businesses with a payroll of less than $3 million for the 2019-2020 financial year. Payments are expected to be issued automatically.

The government has stressed that this payment is a refund, not a loan.

Payroll tax deferrals

Small businesses will also be eligible for a deferral of payroll tax payments for the first three month of the 2020-2021 financial year. Payments for this period will now be due in January 2021.

Deferral of Land Payment Tax

Landowners who have at least one taxable non-residential property and total taxable landholdings below $1 million are eligible for a deferral of their land tax payment. The Victorian State Revenue Office will directly contact eligible landowners.

The payment can be deferred until after 1 January 2021 but will need to be paid in full by 31 March 2021. Non-residential property includes commercial property, Industrial property, and vacant land (excluding residential vacant land).

Working for Victoria fund

Businesses in the hospitality, tourism, accommodation, arts, entertainment and retail sectors may also receive additional assistance through a new business support fund to be established by the Victorian government in partnership with the Australian Industry Group, the Victorian Chamber of Commerce and Industry and the Australian Hotels Association.

The initiative will commit 500 million and will target helping to find employment for workers who have lost their jobs because of the coronavirus pandemic.

The fund will support businesses that may not be eligible for payroll tax refunds because their payrolls exceed $3 million.

Details of the fund can be found here.

Fast Tracking Cashflow

The Victorian government has pledged to pay all outstanding supplier invoices within five business days.

In addition to the state government's support, the City of Melbourne has pledged $10 million to support local businesses and keep city residents in jobs.

The city is offering grants for SMEs, totaling $5 million.

Up to $2,000 is available for training and professional development; up to $5,000 is available for investing in online and e-commerce activities; and up to $10,000 is available in dollar-for-dollar funding for capital works projects, to adapt to the changing conditions.

Grant applications can be made here

Fees have been waived for street trading and outdoor dining areas, for three months, as well as and fees for food act registrations.

The city is also offering cross-training and employment for 200 casual workers, who will be deployed to work on improving the cleanliness of the city.

Finally, the city is hosting a virtual business support summit offering one-on-one advice to affected businesses.

Payroll tax relief

Queensland businesses that have been affected by the COVID-19 outbreak may be eligible for payroll tax relief, refund or deferral.

All employers that pay less than $6.5 million in Australian taxable wages will be eligible for a refund of two months' payroll tax.

They will also be eligible for a three-month payroll holiday, and a deferral of payroll tax for the 2020 calendar year.

Businesses that pay more than $6.5 million in wages and have been directly or indirectly affected by the coronavirus, can also apply for the refund and deferral.

In this case, that means the business will have seen a negative effect on turnover, profit, customers, bookings, sales or supply contracts, compared to normal conditions.

Application forms for the refund, holiday and deferral are available here.

Interest-free loans

The state government is also offering low-interest loans of up to $250,000.

Loans will be interest-free for the first 12 months and are intended to help businesses keep employees on board and maintain their operation until the worst of the crisis has passed.

The Queensland Rural and Industry Development Authority is currently accepting expressions of interest for the loans. Businesses that are interested should contact the authority here.

Rent relief

Businesses that rent government premises will be given six months' rent relief.

Diversification grants

Small businesses in the agriculture, food and fish exporting industries may be eligible for grants of between $2,500 and $50,000, for diversifying their business and accessing new markets.

The application form for the grant program is here.

Power bill relief

Sole traders and SMEs will also receive a $500 rebate on their electricity bills, if they consume less than 100,000 kilowatt hours. The rebate will be applied automatically to all business electricity bills.

Fees waived for Tourist Industry and Hospitality Businesses

The government is also waiving various fees relating to small business, including for some variations of liquor licences, registration for inbound tour operators, commercial activity permits, marina charges and tourism rental payments.

Mentoring

Finally, the government is offering tailored advice for small businesses, as well as a series of workshops and forums, to help them expand their business overseas.

Support is also available in things like financial management and business planning.

Read more about the Queensland stimulus here.

Payroll tax grants

In Western Australia, an initial stimulus package announced earlier in March stated small businesses with a payroll of between $1 million and $4 million will receive a one-off grant of $17,500.

The grants will be paid automatically and are expected to start being distributed by July.

Also businesses with payroll of less than $1 million will become exempt from payroll tax from July 1 2020, as the threshold increases six months ahead of schedule.

Payroll tax waiver

A second stimulus package said payroll tax will be waived for the four months from March 1, 2020, for businesses with an annual wage bill of less than $7.5 million.

This comes in addition to the previously announced grants.

However, it replaces the payroll tax deferral offering that was announced in the previous package.

Payroll tax deferral was available for employers that pay up to $7.5 million in taxable wages, and that have been directly or indirectly affected by the COVID-19 outbreak.

It does not appear that businesses will have to prove they have been affected in order to claim the waiver, but this may change by the time the legislation enacting the pledge is drafted.

The government has also said that affected businesses will also be able to apply for an interest-free arrangement for penalties related to late payroll tax payments.

Read more about these initiatives here.

Fees waived

In its second stimulus, the WA government also said it will waive fees for small and medium businesses that have been affected by COVID-19.

This includes licences for building services, plumbers and electricians; tourism businesses operating in national and marine parks; fishing licences; taxi authorisation fees; and more.

Renewal fees for liquor licences have been waived for 2020, and businesses that have already paid will be refunded.

Affected businesses will also be able to apply for an interest-free late-payment arrangement for penalties relating to transfer duty, landholder duty, vehicle licence duty and land tax, as well as payroll tax.

Energy bills

The government is offering small businesses a one-off credit of $2,500 for Synergy and Horizon Power bills.

This is available to current customers, as of March 31, that use less than 50 megawatt hours per annum. The credit will be distributed from May 1, to help businesses reduce future electricity bills.

The state government has also put a halt to any power or water disconnections due to late payments, and no interest will be charged on deferred bills.

The South Australian government made an initial $350 million pledge and has followed this with a second $650 million state stimulus package, bringing the total to around $1 billion.

The government has said:

The packages are scant on the details at the time of writing but will surely be updated on the SA Government website in April.

Payroll tax relief

South Australian businesses with an annual payroll of up to $4 million will be eligible for a six-month waiver of their payroll tax, starting from April.

Businesses with payroll of more than $4 million will be able to defer their payroll tax payments for six months, if they can show they have have seen a significant impact to their cash flow, because of the coronavirus.

Investment in local projects

The government has said it is working on delivering $50 million worth of projects to support local jobs and businesses. This will include road and hospital upgrades and new tourism infrastructure. An emphasis will be given to projects where work is ready to begin in a short space of time.

To secure funding, projects must be either labour-intensive, require a significant amount of materials and supplies purchasing, or both.

Fees waived

Finally, the government has implemented a waiver of liquor licence fees for the 2020-2021 financial year, for businesses forced to close as a result of the national social distancing restrictions.

The Tasmanian Premier Peter Gutwein has announced initiatives about a billion dollars.

Payroll tax waiver

Tasmania initially offered a waiver of payroll tax liabilities for some small businesses.

The waiver is available to those in the hospitality, tourism and seafood industries, and will apply for the for the entirety of the 2019-2020 financial year.

Full details have not been released, but this is likely to involve payroll tax refunds, as well as the waiver. Check the Tasmanian government website for details.

Other businesses with payrolls of up to $5 million will also be able to apply for this package, but eligibility will be based on how significantly the virus has affected the business.

Interest-free loans

The government has announced an intention to offer interest-free loans available to small businesses with a turnover of less than 10 million in the hospitality, tourism, seafood production and export sectors to the tune of $50 million. The loans are intended to be used for purchasing of equipment or for restructuring business operations.

Loans will be offered interest-free for three years. Details on how to apply have not yet been released. Again, watch for details on the Tasmanian government site.

Small business grants

The government has also launched a new $40 million small business grants program. Half of this is set aside for an emergency grants program, offering $2,500 cash payments to distressed businesses.

Fees waived

Tasmania is waiving fees for certain licences and leases applicable to small businesses. These include a 50% discount on liquor licensing fees and a waiver on application fees; waiving park entry fees for tourism operators; and waiving of some fisheries fees for 12 months.

The government will waive fees and charges on some motor tax for heavy vehicles, and vehicle registration for affected businesses.

Power bill relief

A freeze on water and electricity bills has been announced. Some small businesses will have their water and electricity bills waived for their first quarterly bill, received after April 1. Businesses on tariffs 22, 94, 82 and 75 will have their bills waived, as well as small businesses on market contracts that could access these tariffs.

Electricity bills will be capped for the next financial year, and water bills will be frozen.

New Employment incentives

Grants of up to $5,000 will be available to businesses that hire an apprentice or trainee in the tourism, hospitality, construction or manufacturing industries.

Similarly, a youth employment scheme will encourage businesses to hire young people, aged 24 and under, by offering a rebate on payroll tax for one year.

The government has also implemented a $100,000 tourism and hospitality training fund, in a bid to make sure the industry is ready to bounce back effectively when the crisis passes.

Pledge to Investment in local projects

The Tasmanian government initially allocated $50 million to fast-track maintenance on public buildings over the next 12 months.

In addition, it has now extended the government loan scheme from $50 million to $150 million, in a bid to keep projects flowing.

The investment is intended to help support local trade businesses and self-employed people in this sector.

Advice and Training

The government is offering business continuity advice on cashflow and continuity, including from the Rural Financial Counselling service.

The full government package can be viewed here.

Payroll tax waiver

The Australian Capital Territory is offering a one-off payroll tax waiver for businesses in the hospitality sector, for the six months from April to September 2020.

Businesses will have to complete an online application form, although this is not yet available.

Payroll tax deferral

The government is also allowing all businesses with payroll of up to $10 million to defer their 2020-2021 payroll tax payments, interest free, until July 1, 2022.

The deferral applies to all ACT businesses with Australia-wide wages of up to $10 million. There will be a form to fill in to apply for the deferral, which is not yet available.

Fees waived

The government is offering a 12-month waiver of all food business registration and on-licence liquor licensing fees, from April 1 2020.

If registration has been prepaid, an additional 12 months will be added to the licence.

It's also waiving vehicle licensing fees for ridesharing operators, and taxi plate fees, for 12 month from April 1.

These fees will be waived automatically.

Electricity rebates

Businesses with electricity usage below 100 megawatts per year will receive a rebate of $750, regardless of supplier, the government has said.

Again, this rebate will be issued automatically, with no need to contact suppliers.

Investment in local projects

The government has pledged $20 million to fast-track infrastructure projects and maintenance.

Funding will be available for jobs that can start immediately, that will employ local suppliers and workers, and that meet social distancing requirements.

The fund is expected to be utilised before the end of the financial year.

Advice

The ACT government is also offering a small business advice and support service, offering one-on-one business management advice. Business owners will be able to access up to four hours of subsidised, face-to-face tailored advice, plus access to online resources.

The government is also increasing subsidies for apprenticeship and traineeships and offering access to training opportunities.

Business owners can call the business liaison line on 6205 0900.

Small business survival fund

The Northern Territory government has launched a $50 million Small Business Survival Fund, offering grants to small businesses to help the adapt to changed trading conditions.

Eligible businesses will be able to apply for two payments:

The Small Business Survival Fund is available to eligible businesses in addition to other support, including the Jobs Rescue and Recovery plan and the Tourism Resilience Package.

You can apply for the Small Businesses Survival Fund on the Business Recovery website.

Business improvement scheme

In March, the government released a recovery plan, including a $20 million business improvement scheme.

Under the scheme, businesses will be eligible for grants of $10,000 for improving business premises. This can include new equipment, new fitouts and physical changes to attract customers.

It is not currently clear what is required for eligibility.

If they can also contribute $10,000 of their own, they will receive an additional $10,000, for a total of $30,000 funding.

The government is also offering assistance to businesses that have to physically adjust to new social distancing rules, although details of the support are not yet available.

Banks Policy

It has also encouraged banks to be flexible in dealing with businesses; asked landlords to consider reducing or deferring rental payments for businesses; and called on the private sector to be flexible in their contract arrangements.

Jobs Rescue and Recovery

Tradies and contractors can register now to provide works through the Home Improvement Scheme, Business Improvement Grants and Immediate Work Grants.

The Jobs Rescue and Recovery plan's Small Business Survival Fund is a $50 million initiative to help Territory small businesses survive the unprecedented economic impacts of coronavirus (COVID-19).

The fund specifically targets support to businesses in the hospitality, restaurant, tourism and entertainment sectors that have had a significant reduction in trade due to the shutdown and social distancing provisions.