This evening, the Morrison Government will unveil the 2020-21 Budget.
With a focus on job creation and consumer spending, Treasurer Josh Frydenberg's 2020-21 Budget is anticipated to be one of the most consequential in recent memory.
Treasury's key business programs featured in the Budget include further tax relief and support for businesses to employ apprentices and trainees.
New apprentices and trainees
Businesses who take on a new Australian apprentice will be eligible for a 50% wage subsidy, regardless of geographic location, occupation, industry or business size.
Under the new measure, employers will be eligible for 50% of the wages for a new or recommencing apprentice or trainee for the period up to 30 September 2021, up to $7,000 per quarter.
The scheme will see 100,000 new apprentices or trainees enter the workforce to help the economy recover from COVID.
Prime Minister Scott Morrison said that the government wants to continue to get people into work.
"During this pandemic the Federal Government has been focused on supporting and creating jobs as well as identifying the skills we need in the economic rebuild.
"Already 760,000 jobs that were either lost or reduced to zero hours as the COVID crisis hit, have come back into our economy.
"We want to continue to recover what has been lost and get young people into work.
"Whether it’s the manufacturing, housing and construction, arts or mining sectors – this new wage subsidy gives businesses certainty to hire and provides a career path to aspiring, young tradies," he said.
The subsidy is available to employers of any size or industry, Australia-wide who engage an Australian apprentice or trainee from October 05 2020 until the 100,000 cap is reached.
The government has invested $1.2 billion into the program.
Tax relief
Another key element for businesses is further tax relief.
Businesses with an aggregated annual turnover between $10 million and $50 million will have access to up to ten small business tax concessions.
Changes include:
- From 1 July 2020, eligible businesses will be able to immediately deduct certain start-up expenses and certain prepaid expenditure.
- From 1 April 2021, eligible businesses will be exempt from the 47% fringe benefits tax on car parking and multiple work-related portable electronic devices, such as phones or laptops, provided to employees.
- From 1 July 2021, eligible businesses will be able to access the simplified trading stock rules, remit pay as you go (PAYG) instalments based on GDP adjusted notional tax, and settle excise duty and excise-equivalent customs duty monthly on eligible goods. Eligible businesses will also have a two-year amendment period apply to income tax assessments for income years starting from 1 July 2021.
- In addition, from 1 July 2021, the Commissioner of Taxation’s power to create a simplified accounting method determination for GST purposes will be expanded to apply to businesses below the $50 million aggregated annual turnover threshold.
These additional changes build on other support measures for businesses including JobKeeper, extension of the Instant Asset Write-Off scheme and the Cash Flow Boost program.
The changes are estimated to support an additional 20,000 businesses and their employees.