Covid 19 Update 2

March 22, 2020

 

THE AUSTRALIAN BICYCLE INDUSTRY



In what is a rapidly changing environment, there were several announcements regarding Covid-19,
 
With the closure of Victorian schools, closure of state and territory borders, increased social distancing requirements and forced closure of specific businesses, the BIA is focused on ensuring bicycle shops are able to remain open during the closures.

After NZ's announcement today it is moving to level 4, closure of ALL non-essential businesses, this has become the priority.

The BIA has sent requests to the Prime Minister and Treasurer and the Premier and Chief Minister of each state and territory, along with requests through direct political contacts.

We will continue to follow up with each office to push for bicycle stores to be included on the essential services list.

To assist us, I am requesting assistance from bicycle retailers -

  1. Please provide to BIA data to support the increased demand for bicycle retail and mechanic services by answering four quick questions

    1. State

    2. Regional v metro

    3. Percentage change to service turnover in March from previous month

    4. Percentage change to sales in March from previous month

Please forward this directly to office@bikeoz.com.au or if you would prefer to remain anonymous, details can be added at https://www.surveymonkey.com/r/V868X78

  1. If you have contact with a specific federal or state member, please utilise that relationship to push for clarity on the matter - A draft of the letter sent to the states can be found here to use for information

WHAT TO DO IF STAYING OPEN?

A number of stores have requested information on what measures they should put in place if staying open.

A summary of possible actions to keep you and your staff safe can be found here 

This is not an exhaustive list and each business must make their own risk assessment and implement appropriate systems.

FUNDING PACKAGES

Since the last BIA update on Friday, there has been a number of stimulus packages released.
If you missed last Fridays summary of state and national funding packages, you can check it out here

Two key packages released over the weekend were the Federal Government part 2 and the Victorian state government.
Some local governments have released individual packages, please refer to your LGA for these.

FEDERAL GOVERNMENT - PART 2

There are three key components to the federal package - the summary below relates to business.
Full details can be found at https://treasury.gov.au/coronavirus/businesses

FOR BUSINESS

  • Boosting cash flow for employers

  • Temporary relief for financially distressed businesses

  • Increasing the instant asset write-off

  • Backing business investment

  • Supporting apprentices and trainees

Boosting cash flow for employers
The Government is enhancing the Boosting Cash Flow for Employers measure it announced on 12 March 2020. The Government is providing up to $100,000 to eligible small and medium-sized businesses, and not for-profits (NFPs) that employ people, with a minimum payment of $20,000.
Under the enhanced scheme, employers will receive a payment equal to 100 per cent of their salary and wages withheld (up from 50 per cent), with the maximum payment being increased from $25,000 to $50,000. In addition, the minimum payment is being increased from $2,000 to $10,000.

Temporary relief for financially distressed businesses
The economic impacts of the Coronavirus and health measures to prevent its spread could see many otherwise profitable and viable businesses temporarily face financial distress. It is important that these businesses have a safety net to make sure that when the crisis has passed they can resume normal business operations. One element of that safety net is to lessen the threat of actions that could unnecessarily push them into insolvency and force the winding up of the business.

Increasing the instant asset write-off
The Government is increasing the instant asset write-off threshold from $30,000 to $150,000 and expanding access to include businesses with aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020. In 2017-18 there were more than 360,000 businesses that benefited from the current instant asset write-off, claiming deductions to the value of over $4 billion. This measure will support over 3.5 million businesses (over 99 per cent of businesses) employing more than 9.7 million employees.

Backing business investment
The Government is introducing a time limited 15 month investment incentive (through to 30 June 2021) to support business investment and economic growth over the short term, by accelerating depreciation deductions. Businesses with a turnover of less than $500 million will be able to deduct 50 per cent of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset’s cost.

Supporting apprentices and trainees
The Government is supporting small business to retain their apprentices and trainees. Eligible employers can apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage for 9 months from 1 January 2020 to 30 September 2020. Where a small business is not able to retain an apprentice, the subsidy will be available to a new employer that employs that apprentice. Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).

Support for Coronavirus-affected regions and communities
The Government will set aside $1 billion to support regions most significantly affected by the Coronavirus outbreak. These funds will be available to assist during the outbreak and the recovery. In addition, the Government is assisting our airline industry by providing relief from a number of taxes and Government charges estimated to total up to $715 million.

DETAILS - https://treasury.gov.au/coronavirus/businesses

Coronavirus Business Liaison Unit
A Coronavirus Business Liaison Unit has been established within The Treasury to engage with business on a regular basis and provide updates to government on crucial issues.

VICTORIAN GOVERNMENT PACKAGE

Payroll Tax refunds
Full payroll tax refunds for the 2019-20 financial year to small and medium-sized businesses with payroll of less than $3 million
Payments will commence next week.
 
Payroll Tax deferral
Defer any payroll tax for the first three months of the 2020/21 financial year until 1 January 2021, freeing up a further $83 million in cashflow
 
Rent relief – Government buildings
Commercial tenants in government buildings will be eligible to apply for rent relief. Tenants will apply directly through the landlard.
 
Land Tax Payments deferral
2020 land tax payments will be deferred for eligible small businesses.
 
Business Support Fund
$500 million to establish a Business Support Fund. The fund will support the hardest hit sectors, including hospitality, tourism, accommodation, arts and entertainment, and retail.
Further details will be released shortly.
The Government will work with the Victorian Chamber, Australian Hotels Association and Ai Group

Working for Victoria Fund
The Government will establish a $500 million Working for Victoria Fund in consultation with the Victorian Council of Social Services and Victorian Trades Hall Council. The fund will help workers who have lost their jobs find new opportunities, including work cleaning public infrastructure or delivering food

If you have questions, please contact me at pbourke@bikeoz.com.au or on 0438871271

Stay well, and look forward to talking to you soon

Regards Peter

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