State government unveils “biggest package of business support” in Victorian history
On Sunday 13 September, Premier Daniel Andrews announced a $3 billion package to help struggling Victorian businesses get back on their feet as restrictions begin to ease across parts of the state.
At Sunday’s briefing, Premier Andrews said “[This] is without any shadow of a doubt, the biggest package of business support in the history of this state, and it needs to be unprecedented in nature.”
This is the third round of fiscal support announced by the State Government designed to help businesses stay afloat during the global pandemic, following the announcements on 10 July and 3 August.
On 14 September, the Premier also announced a further $100 million in support for sole traders as part of a $290 million Outdoor Eating and Entertainment Package to get Victorians dining out over summer.
Despite the disappointment a week prior, the Victorian Chamber welcomed the new announcement, knowing that thousands of businesses would receive a renewed sense of confidence and hope.
“Today’s announcement is a signal of confidence in business and will provide hope for many businesses that may have been wondering how they will get through the coming weeks of continued restrictions,” said VCCI chief executive Paul Guerra.
“This is what the business community has been calling for, a forward-looking announcement that provides confidence in being able to manage without cashflow for now, and how businesses can begin to reskill and recover when the virus is under control.”
Mr. Guerra also appeared on Channel 7’s Sunrise program with David Koch to discuss the announcement and what more is needed to help businesses survive during lockdown.
The new business support package
In recognition of the prolonged restrictions Victorian businesses have faced compared with other states, the Victorian Government will issue a series of grants to help the businesses who need it most – in particular the hospitality and tourism sectors, while giving a boost to wellbeing and mental health support.
Business Survival package ($1.08 billion)
The third round of the Business Support Fund will provide up to $20,000 for each business with a payroll of up to $10 million. Along with various eligibility requirements, the amount of funds a business will receive will be based on how much that business pays in annual payroll:
- $10,000 if annual payroll is less than $650,000
- $15,000 if annual payroll lies between $650,000 and $3 million
- $20,000 if its payroll is between $3 million and $10 million
Grants of up to $30,000 will be available in for those in the hospitality sector including pubs, clubs, hotels and restaurants based on their venue capacity and location.
On Monday, Premier Andrews also announced a $100 million ‘City Recovery Fund’, jointly funded by the City of Melbourne. The fund will give practical support to small and medium-sized business to run events and activities during the summer.
Due to the devastation of the lockdown in the tourism sector, in particular the skiing season, a special Alpine Businesses Grants of up to $20,000 are available to help alpine businesses pay a service charge to Alpine Resort Management Boards.
Business Adaptation package ($44.2 million)
This package is designed specifically to help businesses adapt and acclimate to a new ‘COVID Normal’ environment once restrictions are eased for each sector. The package provides funding, tools and resources to help all Victorian businesses move forward.
The package includes a $20 million voucher program designed to help businesses thrive as having a digital presence becomes all the more important.
The Government is also investing a further $8.5 million toward the growth of intra-state trade and travel by expanding the ‘Click for Vic’ campaign. For inter-state exporters, a $15.7 million package has also been developed to help get products to market faster and easier by establishing new trade channels.
Waivers and deferrals ($1.83 billion)
While cash handouts will greatly benefit businesses get out of debt, the Victorian Government has also put forward a series of tax waivers, deferrals and discounts to help businesses in the 20/21 financial year.
With the new package announcement, Victorian businesses will receive $1.7 billion in payroll tax deferrals for the full 2020-21 financial year.
Regional property businesses will be able to celebrate a $41 million investment from the government to bring forward a 50% stamp duty discount available for commercial and industrial properties. Also $6 million has been invested to waive the Vacant Residential Land Tax for vacancies in 2020.
The hospitality sector will receive further support again as pubs, restaurants and clubs will have their liquor license fees waived in 2021, which will cost the state $27 million.
Another $33 million has been set aside to defer the planned increase in the landfill levy, and $30 million has been put forward to waive 25% of the Congestion Levy this year.
The Victorian Chamber continues to advocate for an increase to the threshold for coverage by payroll tax and a reduction in the payroll tax rate to keep Victoria competitive with other states and to eliminate a tax on jobs.
Sole Trader support and CBD revamp
On Monday 14 September, along with Premier Daniel Andrew, Minister for Jobs and Precincts, Martin Pakula, announced the state government will dedicate $290 million towards the support of sole traders, the hospitality and events sectors.
The Victorian Government has set aside $100 million in grants for sole traders while also planning to revamp the Melbourne CBD and increase outdoor dining over the summer, similar to tactics employed by New York and London.
“Melbourne and Victoria will apply the best overseas experience to create a new, exciting model for outdoor entertainment as the weather begins to warm up,” said Daniel Andrews.
While sole traders were largely omitted from the initial Business Support Fund, each of the 33,000 sole traders that operate across the state may now be eligible for a $3,000 grant. Sole traders in the tourism, retail, fitness and cultural sectors are expected to benefit the most from the plan.
$87.5 million will also be given to local councils and businesses outside of Melbourne’s CBD to develop outdoor dining areas, as a further $100 million will go to funding the ‘reshape’ of Melbourne’s CBD in partnership with the City of Melbourne.
Another $58 million will go towards grants of up to $5,000 to help hospitality businesses fund practical items for outdoor dining such as umbrellas, outdoor furniture and training.
The Victorian Chamber will continue to work with both Federal and State Governments to support all Victorian businesses receive the support they need to be able to reopen, restart and recover from the pandemic.
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