Federal Government Second Corona Stimulus Package

27 Mar Federal Government Second Corona Stimulus Package

The Federal Government has announced its second $66B economic responses which, combined with its previous announcement, total $189 billion across the forward estimates. There are some important proposals that will likely have significant impact to clients. Below you’ll find a round up on whats been announced along with some fact sheets on what the government is promising to Australians.
 

SUPPORT FOR WORKERS, RETIREES AND HOUSEHOLDS

• Time-limited $550 per fortnight supplement for both existing and new recipients of the JobSeeker Payment, Youth Allowance jobseeker, Parenting Payment, Farm Household Allowance and Special Benefit.
• A further $750 payment to social security and veteran income support recipients and eligible concession card holders.
• Individuals in financial stress can access up to $10,000 tax-free of their superannuation in 2019/20 and a further $10,000 in 2020/21.
• Temporary reduction in the superannuation minimum drawdown requirements by 50 per cent for 2019/20 and 2020/21, providing retirees with more flexibility as to how they manage their superannuation assets.
• Deeming rates reduced by a further 0.25 percentage points to reflect the latest rate reductions by the Reserve Bank, making the lower deeming rate 0.25 per cent and the upper deeming rate 2.25 per cent.

 
EXPANDED CASH FLOW INJECTION TO SMALL BUSINESS

• Another $25.2 billion over four years for individual $100,000 tax-free payments for businesses turning over up to $50 million a year
• The minimum payment for business will be $20,000
• The amount will be 100 per cent of tax withheld to the ATO on employees’ wages
• The government hopes it will benefit 690,000 businesses and 7.8 million workers
• About 30,000 not-for-profits will also be eligible
• Adds to the $6.7 billion in payments already announced

LOAN GUARANTEES

• Government will guarantee 50 per cent of unsecured loans taken out by small businesses in the six months starting from April 1, 2020 with banks who join the scheme
• Loans can be up to $250,000 over a three-year term
• Loans won’t have repayments on them for the first six months
• Won’t apply to existing customers refinancing
• Scheme is worth $20 billion, for total lending of $40 billion 

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