As a result of the snap lockdown imposed on Victoria on 15 July 2021, the Prime Minister announced a set of additional support measures for businesses and workers on 15 July 2021. The measures for shorter lockdowns have been approved by National Cabinet and will apply to all States and Territories henceforth.

See below for further details.

[Tax Month – July 2021]

 


 

Where a lockdown has been imposed by a State or Territory Government for a period of less than 7 days, (as has been announced by the Victorian Government), the Commonwealth will provide income support through the COVID-19 Disaster Payment as follows.

  • A Commonwealth Hotspot has been declared by the Commonwealth Chief Medical Officer.
  • The Commonwealth Government will provide income support for those who work or live in the areas declared as a Commonwealth Hotspot. The provision of income support outside of these areas will be provided where requested and at the cost of the State or Territory Government.
  • Individuals will be eligible for the COVID-19 Disaster Payment if they have lost between 8 and less than 20 hours of work for a payment of $375, and for 20 or more hours of work for a payment of $600, during the period of the lockdown. There will be no liquid assets test applied to eligibility for these payments.
  • A commitment has been made by the State or Territory Government to provide significant economic support, for the same lockdown period, to ensure cost sharing between the Commonwealth and the State or Territory Government.

[Prime Minister’s website – Media Statement]

 

Covid-19 ‘Lockdown’ support payments revised again on eve of Victorian ‘lockdown 5.0’ (Mk III, 2nd revision)

The Morrison government has overhauled income and business assistance measures for the third time in six weeks as the entire state of Victoria joined greater Sydney and plunged into lockdown for five days.

With more than 12 million people again under lockdown and pressure from Victoria for the federal government to do more to help stranded workers and businesses, Prime Minister Scott Morrison “simplified and streamlined” the assistance package.

The package was first unveiled last month in response to Victoria’s two-week lockdown (4.0) at that time, and revamped only on Tuesday in response to the NSW crisis.

Contending that the “very fluid situation” required constant versatility, Mr Morrison said that subject to the national cabinet’s approval on Friday, the income and business support measures would now be paid sooner and, in the case of income support, at a higher rate. The $10,000 liquid assets tests for personal income support will be scrapped.

 

Implications for Victoria (due to current snap lockdown)

  • Eligibility for the COVID-19 Disaster Payment will be made available for the period of the Victorian lockdown (5 days) as it applies to each area of the State.
  • The Commonwealth will fund the payment for those who live and/or work in the areas declared as a Commonwealth Hotspot and the State Government will fund payments provided to the balance of the State.
  • Payments will be made in arrears on application to Services Australia 7 days after the commencement of the lockdown (ie from Friday 23 July 2021).
  • Payments of $600 will be made to Individuals that lose 20 hours or more of work during the period of the lockdown (the next 5 days).
  • Payments of $375 will be made to Individuals that lose between 8 and up to 20 hours of work during the period of the lockdown (the next 5 days).
  • No liquid assets test will be applied to the payment at any time.
  • As for the weekly cash-flow payments of between $1500 and $10,000 for small and medium businesses, they will now be available after two weeks of a lockdown, not from the fourth week as was the previous arrangement.

Information about the COVID-19 Disaster Payment can be found on the Services Australia website.

In addition, the release states that the Victorian Government has agreed to provide additional economic support to businesses, from day one of this lockdown period (satisfying the Commonwealth’s cost sharing requirements for this arrangement).

[Premier’s website –  ‘Cash Support’ statement and possibly (after this is published) on Victorian Government website ]

 

Relevant changes

Worker support (lost 20 or more hours)
  • Now – Payments of $600 will be made to Individuals that lose 20 hours or more of work during the period of the lockdown (the next 5 days).
  • Previously – Those who lost 20 or more hours, were eligible for $500 for weeks two and three and $600 from week four onwards.
Worker Support (lost between 8 and 20 hours)
  • Now – Payments of $375 will be made to Individuals that lose between 8 and up to 20 hours of work during the period of the lockdown (the next 5 days).
  • Previously, workers who lost fewer than 20 hours a week were eligible for a $325 payment in the second and third week of a lockdown and $375 from week four onwards. There would be nothing for the first week.
$10,000 liquid assets test – now scrapped
  • A $10,000 liquid assets test that determined eligibility for the payments in week two was scrapped.

 

NSW Covid-19 support package

Tax Institutes Senior Advocate: Robyn Jacobson, CTA’s summary

The Federal Government has upgraded its national response to COVID-19 outbreaks with increased weekly payments for households, and boosting business cash flow to get them through extended lockdowns.

The new national arrangements have been developed following close cooperation between the Commonwealth and the NSW Governments to ensure additional support is targeted and rolls out as quickly as possible under a new cost sharing agreement.

The support package will see an increase in the COVID-19 Disaster Payment from week two of a lockdown and a 50/50 cost sharing arrangement between the Commonwealth and the NSW Government for a new and expanded small to medium business support package, implemented and administered by the NSW Government.

This level of support will apply nationally to any state or territory that experiences an extended lockdown beyond week three following the declaration of a Commonwealth hotspot.

The extensive support package takes the form of:

  • COVID-19 Disaster Payments;
  • small and medium business support payments;
  • Commonwealth business tax relief;
  • COVID-19 business grants;
  • micro business grants;
  • payroll tax relief;
  • land tax relief;
  • an eviction moratorium for residential tenants;
  • changed rules for commercial and retail tenants;
  • childcare gap-fee waiver; and
  • mental health support.

The Tax Institute has published a blog post on the newly announced NSW COVID-19 support package. It contains a detailed analysis of the measures including hyperlinks and insights from Robyn Jacobson, CTA. Members can find this content here.

[Tax Vine 26, 16/7/21]

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