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New support for businesses in Victorian budget: What’s in it for you?

 

The Victorian government has announced extra support for small businesses recovering from the coronavirus crisis in its 2020-21 budget.

Around $6 million has gone towards a Small Business Support Toolkit that will fund best-practice workshops, mentoring, and coaching services across the state, helping businesses to digitize and innovate, adapt to meet changing customer needs, and navigate regulatory requirements across different levels of government.

 

 

The Victorian government will use record levels of debt and deficit to spend $49 billion in the next four years in an effort to drag Victoria out of the disastrous COVID-19 recession.

The widespread budget covers job creation, health, innovation, housing, transport, and education, with some industries happy with the outcomes and others feeling somewhat ignored.

With the aim of creating jobs and the center of the massive spend,  the Government has set a goal of creating 200,000 jobs by 2022 and 400,000 by 2025, focusing on those hardest hit by the disruption wrought by COVID-19, including women, young people, older workers and those without formal qualifications.

Below are some of the highlights announced in yesterday’s state budget.

  • $5.3 billion for social housing
  • $3 billion to build and upgrade state schools
  • $2 billion for fast trains to Geelong
  • $1.6 billion for school disability funding
  • $870 million in funding for mental health
  • $600 million Jobs Plan, including $250 million in wage subsidies with a focus on older women
  • $500 million Victorian Homebuyer Fund for people who cannot afford a 20 percent deposit
  • $300 million to upgrade Victoria Police systems
  • $290 million to halve stamp duty for new homes worth up to $1 million
  • $100 million for low-interest loans to local councils for infrastructure
  • $50 million for research and development loans
  • $65 million to acquire land for planned hospitals in Pakenham Torquay, Eltham, Point Cook, and Whittlesea
Support for Business

The budget includes the support already provided to Victorian businesses affected by the pandemic this year, such as the $2.6 billion Business Support Fund, and indicates some support will continue for the rest of the financial year.

Businesses with payrolls of up to $10 million can continue deferring payroll tax for the rest of the 2020-21 financial year, and employers will be able to pay payroll tax annually instead of monthly from July 2021, if their yearly payroll tax liabilities are less than $100,000.

SMEs that re-hire staff, restore hours and create new jobs are set to benefit from the new jobs tax credit, which will run for two years. Under the scheme, eligible businesses will qualify for a tax credit of 10 cents for every dollar of Victorian taxable wages above previous years.

Around $6 million will go towards the Small Business Support Toolkit, which will offer SMEs with high-growth potential masterclasses and coaching in digital innovation.

To encourage businesses to open or relocate to regional Victoria, the government is also offering a 50% stamp duty concession on commercial and industrial property purchases.

Farming related small businesses suffering financial hardship will receive free financial counseling as part of the Rural Financial Counselling Service that is co-funded by the federal government.

Job Creation

This year’s Victorian budget also puts forward a plan to create 200,000 new jobs by 2022 and then double that figure by 2025.

A $619 million Jobs for Victoria program will offer $250 million to support businesses through a six-month wage subsidy targeting young people, retrenched workers and people who have been long term unemployed. About $150 million will support women returning to the workforce with wage subsidies directed towards women over 45.

There will also be more funding for apprentices and trainees with a focus on helping women get into the trades.

The Economy

Businesses that hire new staff will be able to pay less in payroll taxes, and the threshold for paying payroll tax has increased.

A 50% stamp duty waiver will be available for new build properties valued at less than $1 million, up to $27,500, and a 25% saving of up to $13,750, for existing properties.

Innovation

Eligible small businesses will be able to access vouchers to build their digital capacity and participate in workshops as part of the Small Business Digital Adaption program.

To drive innovation, the government has allocated $2 billion to Breakthrough Victoria Fund as part of a plan to make Victoria a leader in research and technology.

The Andrews government has also pledged $626 million to improve mobile coverage and broadband access in regional areas under the Digital Future Now fund.

Taxes, Fees and Fines

11.3% drop in state tax revenue, expected to record a massive bounce back by 2021-21 and grow by almost $7 billion by 2023-24.

3.9% average annual increase in income from motor vehicle taxes. A freeze on rego payments will not continue next year.

$911m in fine revenue by 2021/22, with income from speed cameras, toll road evasion, and on-the-spot fines $172m lower in 2019/20 than forecast because of the pandemic.

Sport

$40 million for stage five of Kardinia Park, $36.6 million to upgrade Whitten Oval, and $15.5 million to upgrade Richmond Football Club facilities.

Law and Order

$272 million for new Wyndham Court headquarters, to be integrated with the police station to create a justice precinct and $27.2 million to expand Independent Broad-based Anti-corruption Commission.

$15 million to move as many Magistrates’ court and VCAT hearings online to cut the backlog and $15 million to target speeding drivers.

Transport

A total of $2.2 billion on the Suburban Rail Loop, $2 billion on Geelong fast rail, and $660 million for the next stages of upgrades on the Shepparton and Warrnambool line. The government will also spend $276.5 million on the Dandenong corridor to allow for faster high-capacity metro trains to run and $5.5 million on track works around Caulfield station to enable the separation of the Frankston and Dandenong lines.

There will also be upgrades across Melbourne trams with 100 new modern accessible trams set to retire the ageing A and Z-class trams. Plus $411 million to resurface, rebuild and maintain 1700 kilometres of roads.

Health

$115 million has been set aside for the Metropolitan Health Infrastructure Fund this year, and $66 million to acquire land in Cranbourne, Torquay, Pakenham, City of Whittlesea, Eltham, Point Cook, and the inner south for community hospitals, as well as planning for three more.

A large chunk of work will also start on the $562 million Frankston Hospital, with $16.2 million included in this year’s budget.

Education

A $3 billion infrastructure spend in school upgrades will go towards the renewal of campuses and creating jobs, with almost $250 million for retired teachers to return to schools as tutors and $16.6 million to keep four-year-old kinder free next year.

A $1.6 billion investment that the government says will create more than 1700 jobs will support almost one in 10 Victorian students with individual disability support.

Housing

A total of 9300 new homes, including 2000 for those with a mental illness, have been announced. There will also be 2900 new affordable and low-cost homes for low-income earners so they can live closer to where they work. A quarter of this funding will go towards regional Victoria.

Regional Victoria

Improvements will be made to benefit domestic tourists in tourism hotspots like the Grampians, Wilsons Promontory, and the state’s ski fields, the Government is also spending almost $30 million on vouchers to encourage interstate holidaying.

Environment

In total $1.6 billion has been committed to clean energy, including $797 million last week for heating and cooling efficiency. With an additional $540 million for six "renewable energy zones" in places such as sunny Mildura and the windy east coast.

More information regarding the Victorian 20/21 State budget can be found here.

 

 

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