Treasurer Josh Frydenberg has announced a budget with $507bn in tax cuts, cash payments and wage subsidies to drive business investment and protect the health of Australians with a focus on economic recovery post-COVID and creating almost a million jobs by 2024.
In the Federal Budget handed down last night, Mr Frydenberg unveiled a $74bn jobs and tax stimulus plan, including tax cuts of up to $2745 for 11 million Australians, $200-a-week wage subsidies for young workers and almost $35bn in business tax breaks, saying the government’s economic recovery plan would “rebuild the Australian economy and secure Australia’s future”.
“It’s all about helping those who are out of work get into work, and those who are in a job stay in a job,” he said.
“This budget will create an opportunity. This budget will deliver investment. This budget will grow the economy and guarantee the essential services that Australians rely on.”
The government will move immediately to pass its personal income and corporate tax plan in a $74bn JobMaker omnibus bill to be put to parliament on Wednesday, in a bid to create 950,000 jobs over the next four years.
Although the opposition attacked the budget for not committing to a permanent increase in JobSeeker payments, business, industry groups and universities endorsed the package.
The new measures bring the total stimulus and economic rescue since the start of the pandemic to $507bn, and include $17.8bn in tax cuts for workers, with low and middle-income earners getting tax relief of up to $2745 for individuals and up to $5490 for families in the 2020–21 financial year.
A $4bn wage subsidy, to be called the JobMaker Hiring Credit, will give employers access to payments for each job they create for a worker aged between 16 and 35 over the next 12 months.
The subsidy would be paid at the rate of $200 a week for those aged under 30 and $100 a week for those aged between 30 and 35, based on at least 20 hours’ work a week.
Small, medium and big businesses with a turnover of up to $5bn will also be given $27bn in new tax write-offs, with the expansion of the Instant Asset Write Off to allow the full write-off of eligible purchased assets.
Mr Frydenberg said it was “the largest set of investment incentives any Australian government has ever provided”.
“It is a game changer. It will unlock investment. It will dramatically expand the productive capacity of the nation and create tens of thousands of jobs,” he said.
A further $4.8bn in extra tax breaks would be given to about one million companies through a temporary loss carry-back to allow losses incurred up to June 2022 to be offset against pre-pandemic profits in 2018-19.
The budget also confirmed previously announced COVID-19 support packages, including the $1bn JobTrainer fund, $1.2bn in wage subsidies to support 100,000 apprentices and trainees, and the government’s $1.5bn manufacturing plan.
Mr Frydenberg said that the global economic environment “remains uncertain, with the impact of this crisis to be felt for many years to come”.