The Victorian government has announced a $3 billion support program for businesses affected by the state’s extended COVID-19 lockdown, in a major push to position the economy to reopen in the coming months.
Unveiled by Premier Daniel Andrews on Sunday, the latest round of state government stimulus doubles the dollar value of funding provided to businesses over the course of the pandemic, now standing at $6 billion.
Broadly, the latest package is split into three parts:
- Business survival grants, including $1.08 billion in funding to help businesses ride out the remainder of stage four;
- Business adaption support, including $44.2 million to assist SMEs to get back on track in the wake of the pandemic; and
- Waivers and tax deferrals worth $1.8 billion to ease the burden on companies trying to recover in 2020-21.
While many of the programs aren’t yet open for application, and many details are still to be provided, we’ve compiled what we know so far, breaking down each aspect into its requisite parts.
Business survival: How to access $1.08 billion in grants
Under the latest support package, $1.08 billion has been allocated to grant programs to help get SMEs up and running.
This includes the third round of the Business Support Fund and separate programs for licensed hospitality venues and alpine resorts, as well as new grants for business chambers and trade groups.
Business Support Fund: Round three
You may know Victoria’s Business Support Fund as the batches of $10,000 to $20,000 grants made available during the state’s second wave.
On Sunday, the government unveiled a third round, worth $822 million, that will provide up to $20,000 for businesses with payrolls up to $10 million.
Here’s how it works:
- Businesses with payroll less than $650,000 in 2019-20 will receive $10,000;
- Businesses with payroll between $650,000 and $3 million in 2019-20 will receive $15,000; and
- Businesses with payroll between $3 million and $10 million will receive $20,000.
To be eligible, businesses must be participants of the JobKeeper program, employ people registered with WorkSafe, and be registered for GST.
Sole traders without employees won’t be able to access this program.
Applications aren’t open yet but watch this space.
Licensed hospitality venue grants
In addition to the Business Support Fund, $251 million has been pledged to fund grants up to $30,000 for licensed pubs, clubs, hotels, bars, restaurants and reception centres.
This program will build on the existing Hospitality Business Grant program, which was offering up to $25,000 grants as a one-off.
The new funding will be based on venue capacity and location, but no specific details have been made available by the state government yet.
A further $4.3 million has been pledged to provide grants worth up to $20,000 to alpine businesses to help cover resort fees.
Business chambers and trader groups
A total $3 million has been outlaid for “competitive” grants to support business chambers and trader groups in rolling out programs that help member businesses get back on their feet.
Business adaption: $44.2 million available for SMEs getting back on track
This part of the support program is ostensibly to provide opportunities to re-tool, adapt and prepare for reopening under “COVID normal” settings.
It includes a $20 million voucher program to assist sole traders and small businesses in building their digital capabilities, essentially enabling the purchase of off-the-shelf software-as-a-service (SaaS) products such as Shopify.
It will also fund training and workshops for business owners looking to move their businesses online in the wake of the pandemic.
Further, $15.7 million has been pledged to bolster Victoria’s export market, including addressing logistics and supply chain issues wrought during COVID-19.
This will see businesses connected to international markets via “virtual trade missions” and given advice about entering new markets.
Lastly, another $8.5 million has been outlaid to expand the marketing and advertising efforts behind the Click for Vic campaign — a state government initiative driving leads to independent e-commerce and hospitality businesses.
The program, launched during stage four, has already generated 211,000 leads to businesses featured on the website, the government said.
We won’t charge: Victoria waives and defers $1.8 billion in fees and taxes
Victoria will forgo charging or otherwise defer $1.8 billion in fees and taxes in 2020-2021 to ease the burden on companies impacted by the coronavirus crisis.
The bulk of this will come from $1.7 billion in payroll tax deferrals, which will run through the entirety of the 2020-21 financial year.
While the state government has already refunded $540 million in payroll tax for the 2019-2020 financial year and granted full waivers to other businesses, the plan for 2020-21 is not to remove the payroll tax obligation but delay it until 2021-22.
All businesses with payrolls up to $10 million will be eligible for the deferrals, although the government has yet to stipulate whether this will be automatically applied or not.
Other waivers and deferrals include:
- A $41 million pledge to bring forward the 50% stamp duty discount for commercial and industrial property owners;
- A $33 million deferral of a planned increase in the landfill levy for six months;
- A $30 milli0n commitment to waive the 25% congestion levy in 2020, with outstanding balances deferred;
- Liquor license fee waivers worth $27 million for 2020; and
- A $6 million promise to waive vacant residential land tax in 2020.