The West Australian Government’s response to COVID-19 (Coronavirus) is a delicate balance between combating the virus versus protecting the economy. With over $160 billion wiped off the stock market, the WA Premier Mark McGowan has announced all increases to household fees and charges, including electricity, water and vehicle registration will be frozen as part of a major economic relief package to tackle the COVID-19 emergency.
WA is currently in the response phase of The Pandemic Plan
Western Australia’s pandemic plan includes some major steps to restrict the expected spread of COVID-19 across the state.
- The pandemic plan suggests households should prepare for a possible prolonged stay at home by considering how they ensure there is two weeks’ supply of food and medication on hand for all residents and pets.
- The pandemic plan also anticipates disruption of business activities, resulting in some business failure and it encourages all businesses to review working from home arrangements, leave provisions and other employment arrangements as part of their business continuity planning, to ensure that they are prepared and able to implement social distancing in their workplace.
So what now . . . .
Stimulus package targets households, pensioners
The stimulus package announced on the 15 March 2020 by the WA Government will be worth a total of $607 million and ensure the following household bills for the following services will not increase until at least July 2021:
- motor vehicle charges
- the emergency services levy, and
- public transport fares.
Additionally, the Energy Assistance Payment (rebate given to concession card holders) will be doubled to $600 to help seniors in particular.
These measures, along with the government’s stimulus package and a possible Reserve Bank rate cut, will go some way to helping keep the economy up and running. Although, at this stage, it’s still unclear whether people will engage with the economy and spend the money on something other than panic buying toilet paper.
The WA stimulus package targets households and businesses.
Fees and charges will remain unchanged until at least July 2021.
Small, medium business boost
The Premier announced another $114 million will be spent on measures to help small and medium-sized business, including:
- one-off grant of $17,500 for businesses with a payroll between $1 million to $4 million
- fast-track for payroll tax relief for small businesses by six months
- defer payroll tax payments until at least 21 July 2020
This is on top of the Australian Government’s $17.6 billion targeted stimulus package to support the Australian economy through the challenges of the COVID-19. The package is designed to keep small businesses afloat and employees in work, and will focus on supporting the most affected sectors.
The government has stated that the measures are temporary, targeted and scalable. The main areas of support relevant to small businesses are:
- cash flow payment of up to $25,000 for employers
- 50% wage subsidy for apprentices and trainees
- increase in the instant asset write-off threshold to $150,000
- 50% accelerated depreciation for investments.
What does this all mean for SMEs in WA?
Cash flow alert!
COVID-19 will likely cause massive cash flow issues for many small businesses that would normally be viable. A worrying knock on effect is the very real possibility of negative economic impacts as any businesses in their supply chain go under.
If you’re concerned about the impact of the COVID-19 on your business and cash flow over the next few months, there are several financial options to consider to get through the challenges. Contact your local Bentleys office to find out what option might suit you and your business best.
A more detailed overview of all these measures is available from business.gov.au
Important: You should not act solely on the basis of the material contained in this article. Items herein are general comments only and do not constitute or convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of the areas. This alert is issued as a helpful guide to clients and for their private information.