The Federal Government has released a second economic support package to help businesses and families cope with the impacts of coronavirus.
The $66.1 billion scheme, which raises the government’s level of financial support for those affected by COVID-19 measures to $189 billion (equal to 9.7% of GDP), looks set to provide some relief to travel agencies and other travel companies that are doing it extremely tough during this period.
In response to the new measures, the Australian Federation of Travel Agents (AFTA) has provided a summary of the package as it applies to AFTA/ATAS members.
“Please take the time to read over these measures and see how you can get access to support and help,” AFTA CEO Jayson Westbury said.
“We will do all we can to decipher this and send more detail as we are able, but I stress, take a look and try and find your way through.
“AFTA will continue to work with government to identify the acute and specific challenges that we face as people look to cancel or take a credit forward for bookings and how you as the person in the middle can deal with this.
“We know this is a big problem and we are taking this up directly with the government. I hope that we will be able to find a solution that works for everyone."
In its summary, AFTA highlights the following measures it feels will impact the travel industry:
1- Boosting cash flow for employers
The government is providing up to $100,000 to eligible small and medium-sized businesses (SMEs) that employ people, with a minimum payment of $20,000.
AFTA believes “many AFTA members will be able to access this and get the benefits from it. We will get the detail; this should be simple to access”.
2- Temporary relief for financially distressed businesses
The ATO will tailor solutions for owners or directors of a business while the government temporarily increases the threshold at which creditors can issue a statutory demand on a company and to initiate bankrupt proceedings, among other things.
3- Support for immediate cash flow needs for SMEs
The government will guarantee 50% of any new business loans up to $250,000, with no repayment required for six months.
“AFTA will be seeking clarification from banks to make this easy for travel agencies and to ensure this can happen quickly. If not, we will go back to the Government and ask for more help.”
4- Quick and efficient access to credit for small business
The government will make it easier for small businesses to get access to credit quickly and efficiently. AFTA believes this is good news for travel agency owners and will test this to establish how it will work.
5- Increasing the instant asset write-off
This measure will see the instant asset write-off threshold rise to $150,000, which AFTA says may benefit some members.
6- Early release of superannuation
The government will give eligible individuals access to up to $10,000 of their superannuation in 2019-20 and a further $10,000 in 2020-21, with no taxes to be paid on released monies.
“AFTA believes this is a strong measure for sole traders who will be facing the dramatic downturn in sales and if it is available to them, this would be a way to get access to funds quickly.”
7- Supporting apprentices and trainees
Impacted employers can apply for a subsidy of 50% on trainee wages up to $21,000 (per worker) for nine months from 1 January 2020.
8- Sole traders may be eligible for Newstart
Under this measure, sole traders can apply for income assistance when businesses record no or limited sales.
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