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The largest rescue package in Australian history has passed Parliament

 

The Morrison government’s $130bn wage subsidy package has passed both houses of parliament with Labor support.

Two bills to create the $1,500 fortnightly jobkeeper payment to keep Australian workers attached to jobs until the Covid-19 crisis abates passed the Senate on Wednesday evening.

About six million workers are expected to be covered by the program, but many businesses remain nervous about their prospects, as the Australian Taxation Office (ATO) prepares to begin accepting formal applications.

Businesses with a 30 per cent fall in turnover due to coronavirus will receive $1,500 a fortnight for each eligible employee, with payments expected to reach employers in the first week of May. 

For companies with a turnover of $1 billion, a 50 per cent downturn will be needed to qualify.

More than 730,000 businesses have registered for the program, which will give out money for wages paid from March 30, since it was announced last week.

All full-time and part-time workers are eligible, along with casuals that have a 12-month link to their employer, sole traders and New Zealanders on 444 visas.

Businesses are expected to provide evidence, such as with business activity statements (BAS), of these revenue declines.

Most businesses will be required to prove their turnover has fallen over the course of a month or quarter (depending on their BAS reporting period), relative to their turnover in a corresponding period a year earlier.

Turnover will be calculated in the same way it is for General Sales Tax (GST), which is reported on BAS statements.

Businesses which don’t meet the criteria will be relying on “tax commissioner discretion” to have their applications approved.

Treasury says businesses which have not been in operation for 12 months, or which can show their turnover a year ago was “not representative” of their usual average turnover, will fall under this discretion category.

Businesses which have undertaken acquisitions or have typically highly variable turnover have been singled out by Treasury as candidates for eligibility discretion.

“The Tax Commissioner will have discretion to consider additional information that the business or not-for-profit can provide to establish that they have been significantly affected by the impacts of the Coronavirus.”

Businesses which do not pass this payment on to their staff could face a fine of up to $600,000.

Labor tried and failed to extend the package to an additional one million casuals who fell through the cracks. They proposed a series of amendments attempting to expand access to the jobkeeper payments, including one million casual workers who had worked for their employer for less than a year and temporary visa-holders.

It also proposed a tailored support package for the Australian arts and entertainment sector, called for more support for staff in local councils, charities, schools, Tafes and universities, and a lower threshold to be extended to the disability support sector. However, all of the amendments were voted down.

But the government again re-iterated those left behind can apply for the boosted JobSeeker welfare payment.

The jobkeeper payment is the centrepiece of $300bn of federal government economic supports, which Scott Morrison described as “the biggest economic lifeline in Australia’s history.