Huge tax cuts of up to $2,745 for 11 million Australians, $500 cash hand outs for five million welfare recipients and tax write offs for virtually all businesses are the centrepieces of the government’s big spending pandemic budget.
After COVID-19 forced Australia into its first recession in 29 years, Treasurer Josh Frydenberg took to the despatch box before a socially distanced House of Representatives on Tuesday evening to unveil his emergency plan to kickstart the nation’s battered economy.
‘A Great Depression and two World Wars did not bring Australia to its knees – and neither will Covid 19,’ a sombre Mr Frydenberg said.
As expected, at the heart of Morrison Government’s budget is a plan to fast-track personal income tax cuts that were previously earmarked for 2022.
Those tax cuts will now be backdated to July 2020, with workers pocketing a cash boost of up to $2,745 extra per year.
Some will get all of it in their pay packets, others at tax time.
Mr Frydenberg also announced huge tax breaks for businesses which are allowed to completely write off new assets on the taxman for one year.
Small business owners will also be able to claw back thousands in tax with a new loss carry back scheme.
‘A Great Depression and two World Wars did not bring Australia to its knees and neither will Covid 19,’ a sombre Treasurer Josh Frydenberg said to a chorus of ‘hear hear’ as he handed down Federal Budget 2020
Tax cut winners: Life insurer Luke Jones and his wife Van Jones, a business analyst, will be among those benefiting directly from the income tax cuts, which have been moved forward from 2022 (Mr and Mrs Jones with son Daniel, nine, and daughter Stephanie, two, above)
Under one new scheme announced on Tuesday evening, any business regardless of their size or industry can get a 50 per cent wage subsidy for any new or re-commencing apprentice or trainee they hire. Pictured: A tradeswoman at work
To help the nation get back to work – after coronavirus lockdowns sent more than one million Aussies to the dole queues – a new JobMaker Hiring Credit will give employers $200 per week for every unemployed worker they hire, aged 16 to 29.
The measures will aim to slow the soaring unemployment rate which is projected to hit eight per cent by Christmas before gradually falling to 6.25 per cent by June 2022.
The extraordinary response to the pandemic comes at a massive cost with the government forecasting a record budget deficit of $213billion and a gross debt of $870billion – worth 44 per cent of GDP – this year. The figure will hit $1trillion – more than half of GDP – in June 2022.
Despite the growing mountain of debt, Treasurer Josh Frydenberg provided a message of hope to Australians who are doing it tough.
‘There remains a monumental task ahead. But there is hope. Our plan will grow the economy, create jobs and guarantee the services Australians rely on,’ he said.
However, the budget contains grim news to anyone hoping the pandemic will all be over soon.
The government predicts the entire nation will not be vaccinated until the end of 2021, meaning overseas travel will ‘remain low’ until then.
In a boost for local tourism, the government expects every state border to be open by Christmas, except Western Australia which it believes will remain closed until the day after its election on March 31.
Social distancing is likely to be kept in place through to 2022.
Here Daily Mail Australia takes a look at what’s in the budget – and what it means for you.
Sign of the times: Prime Minister Scott Morrison and Treasurer Josh Frydenberg celebrate the 2020 Federal Budget with an elbow bump
What the Budget means for you:
If you pay tax…
Eleven million Australians will get extra cash in their paypackets within weeks as income tax cuts originally earmarked for July 2022 are backdated to July 2020.
Backdating the cuts means the changes will kick in as soon as they pass Parliament, possibly within days, giving Australians up to $2,745 extra per year in their paypackets.
The cuts will increase the low income tax offset from $445 to $700, lift the threshold for the 32.5 per cent tax bracket from $37,000 to $45,000 and raise the threshold for the 37 per cent bracket from $90,000 to $120,000.
The $1,080 low and middle income tax offset, which was due to be scrapped in 2022, will be kept for this year only, giving those earning between $50,000 and $90,000 a total annual deduction of $2,160 compared with 2017-18 levels.
Those on $40,000 will be $1,060 better off a year, Aussies on $120,000 will be $2,745 better off and those earning more than $140,000 will keep $2,565 more.
The Federal Budget announced Tuesday means workers will, by the end of the financial year, receive the following amount of tax relief on 2017-18 levels
WHEN WILL I GET MY TAX DOLLARS?
It depends on how much you earn.
Aussies earning $130,000 or more will get $2,430 more in their paypackets over the course of each year.
Since taxes are backdated until July, they have been effectively overpaying tax for three months.
They will get what they overpaid back after submitting their tax returns for 2021.
Australians earning under $100,000 will have to wait until their tax return to get their $1,080 offset.
‘Australians will have more of their own money to spend on what matters to them, generating billions of dollars of economic activity and creating 50,000 new jobs,’ Mr Frydenberg said.
‘It will help local businesses to keep their doors open and hire more staff.’
A third stage of tax cuts that abolishes the 37 per cent tax bracket and creates a 30 per cent tax bracket for those earning $45,001 and $200,000 will commence in 2024 as planned.
The slashing of tax brackets, from five to four for the first time since 1984, will see those at the top end on $200,000 receive a tax cut of $11,640 compared with the 2017-18 financial year.
Labor is not expected to oppose the plan to bring forward and backdate the stage-two cuts, meaning millions of Australians could have extra cash in their pockets within weeks.
If you’re on welfare…
Earlier this year the government gave two $750 handouts to pensioners and other groups to stimulate the economy as lockdowns kicked in.
There will now be two more payments of $250 each – late this year and in March 2021.
The payments – costing $2.6 billion – are expected to go to 5.1 million Aussies including those who receive an Age Pension; Disability Support Pension; Carer Payment; Family Tax Benefit; Carer Allowance; Pensioner Concession Card (PCC) holders; Commonwealth Seniors Health Card holders and eligible Veterans’ Affairs payment recipients and concession card holders.
(The government will also fork out $102million over four years to improve veterans’ mental health and care services.)
If you’re a small business owner…
Companies that turn over less than $5billion a year (virtually every business in the country) can buy a new asset of unlimited value– such as a truck or piece of machinery – and expense the whole cost to the taxman for one year.
The measure will apply to assets purchased from 7.30pm on Tuesday and first used or installed by 30 June 2022.
Around 3.5 million businesses – more than 99 per cent of businesses, employing around 11.5 million workers – will be eligible for this measure, which builds on the enhanced $150,000 instant asset write-off announced in March.
Companies with turnover up to $5billion will also be able to temporarily offset tax losses against previous profits and tax paid.
This will help companies that were profitable and tax-paying but now find themselves in a loss position due to the COVID-19 pandemic.
Companies that turn over less than $5billion year (virtually all businesses, no doubt including this cafe) can buy a new asset of unlimited value – such as a truck or piece of machinery – and expense the whole cost to the taxman for one year
Companies can apply tax losses incurred during the 2019-20, 2020-21 and/or 2021-22 income years to offset tax paid in 2018-19 or later income years.
The tax refund will be available for eligible businesses when they lodge their 2020-21 and 2021-22 tax returns.
Those two measures will provide $31.6billion of tax relief, create 50,000 jobs and boost the economy by around $10billion in 2021-22.
The budget also includes 10 tax concessions to small and medium businesses that make between $10million and $50million per year.
They include removing fringe benefits tax paid when a company gives a member of staff free parking or more than one work phone or laptop.
Other concessions to small businesses will include allowing them to immediately deduct certain start-up expenses and prepaid expenditure; simplify their pay as you go tax installments; and settle excise duty once a month instead of weekly.
Furthermore, the amendment period for income tax assessments will be reduced from four years to two years starting from July 1, 2021.
This means the tax office can only demand more tax within two years if officials feel a company has accidentally made a mistake on a tax return.
The changes are estimated to cost the budget $105million over the next three years.
In another major change, all Australian companies are, as of October 2, exempt from paying fringe benefits tax when they pay for workers to train for a different role.
The government hopes this will encourage employers to re-train their staff to fill different positions instead of making them redundant.
Treasurer Josh Frydenberg said: ‘Making it easier for businesses to upskill or reskill their workforce will help people to keep their job or to find a new job as we recover from Covid-19.’
If you’re a young worker…
A new $4billion Hiring Credit will subsidise young people’s wages for one year from Wednesday, October 7.
Young people have been hit hard by coronavirus lockdowns, with around 700,000 on JobSeeker or Youth Allowance and the government believes this scheme will help 450,000 find a job.
The scheme will encourage employers to take on young people by giving them $200 per week for every previously unemployed person they hire aged 16 to 29; and $100 per week for those aged 30 to 35.
There will be a maximum amount of $10,400 per additional new position created.
To be eligible, the employee will need to have worked for a minimum of 20 hours per week, averaged over a quarter, and received the JobSeeker Payment, Youth Allowance or Parenting Payment for at least one month out of the three months prior to when they are hired.
If you’re a Victorian…
Victorian childcare services will get continued support to remain viable as COVID-19 restrictions begin to ease in the state.
The government will spend $314.2 million this year, most of that on a measure to guarantee 25 per cent of the revenue of those businesses.
The government will also provide $47.3 million over two years to boost mental health and crisis support services for people experiencing mental illness and distress as a result of the pandemic in Victoria, including $26.9 million in 2020-21 to establish 15 enhanced mental health clinics.
If you’re a woman…
Women, who have been particularly hard hit by the pandemic, will be supported through various measures in the budget.
Some 9,000 Australians will become eligible for parental leave pay as the government relaxes the rules to let parents access the payment if they have been in work 20 months before the child was born or adopted, rather than 13 months.
Some 3,500 Aussies will become eligible for Dad and Partner Pay. The measures are designed to help people who lost their jobs during the pandemic.
Women are expected to be a central focus of the Federal Budget to be unveiled on Tuesday night. Pictured: Three women walk through Martin Place
There will also be a new Women@Work scheme which will involve more funding for the Women’s Leadership and Development Program to support job creation.
The Government is also establishing a Respect@Work Council to help address sexual harassment in the workplace.
The Boosting Female Founders initiative will be expanded, supporting 282 start-ups and 4,300 mentoring engagements for female entrepreneurs.
There will also be $25.1 million over five years to assist 500 women into STEM careers through a STEM Industry Cadetship or Advanced Apprenticeship.
If you’re an apprentice…
The government has unveiled a scheme to pay half the salary of trainees in any industry for a year.
The plan is expected to cost $1.2 billion and support 100,000 jobs.
Under the scheme, any business regardless of their size or industry can get a 50 per cent wage subsidy for any new or re-commencing apprentice or trainee they hire.
The subsidy applies for apprentices hired from Monday until the government’s cap of 100,000 is reached.
Thousands of apprentices lost their jobs in the coronavirus pandemic shutdowns. The new scheme will give jobs to 100,000 new and re-hired apprentices in any industry. Pictured: Sydneysiders are seen at a pub
Pictured: Tradespeople wave to the camera in Sydney’s CBD during the October long weekend
The subsidy is worth up to $7,000 a quarter and will last until September 30, 2021. The money will be transferred to businesses every three months in arrears.
Thousands of apprentices and trainees lost their jobs, particularly in the hospitality sector, when the pandemic restrictions hit.
Mr Frydenberg said the scheme would apply to every industry, including ‘people who are working as bakers, hairdressers, those who are sparkies, those who are plumbers.’
If you’re struggling to get on the property ladder…
From Tuesday the government will expand its First Home Loan Deposit Scheme to provide an extra 10,000 places.
The measure allows first home buyers to get a loan to build a new dwelling or purchase a newly built dwelling with a deposit of as little as five per cent, with the government guaranteeing up to 15 per cent of the loan.
The scheme has already helped close to 20,000 first home buyers.
The maximum price of eligible homes will be higher for this round of the loan deposit scheme with caps at $950,000 for Sydney, $850,000 for Melbourne and $650,000 for Brisbane.
The measure allows first home buyers to obtain a loan for a new or newly built home with a deposit of as little as five per cent, with the government guaranteeing up to 15 per cent of the loan (stock image)
Treasurer Frydenberg said the loan deposits could be used in conjunction with HomeBuilder, which provides grants of $25,000 for new homes and major renovations.
‘Helping another 10,000 first home buyers to buy a new home through our First Home Loan Deposit Scheme will help to support all our tradies right through the supply chain including painters, builders, plumbers and electricians,’ he said.
‘At around five per cent of GDP, our residential construction industry is vital to the economy and our recovery from the coronavirus crisis.’
If you’re working from home…
The government has announced an $800million package aimed at helping individuals and businesses work online, which Mr Morrison likened to an ‘upgrade of the circuit board’ of the economy.
Mr Frydenberg said coronavirus had changed the way firms do business, with nine in 10 using digital technologies.
More than $400million of the package will be aimed at modernising business registers, allowing companies to quickly view, update and maintain their data.
It will allow for easier distribution of documents, while digital invoicing by Commonwealth agencies will reduce the cost by about two thirds.
More than $250million will be spent upgrading online systems so Australians can access more government services using facial recognition.
At least 1.6 million people and 1.16 million businesses already use facial recognition to access 70 government services.
The technology will be extended to all of MyGov and 14 additional services, such as getting a director identification number or tax file number.
Another $30million will be spent supporting private companies in key industries invest in 5G technology trials.
If you need mental health help…
Australians will get access to 20 subsidised psychological therapy sessions each year under a doubling of current arrangements.
The Morrison government will spend more than $100 million over two years to provide an additional 10 Medicare rebate sessions for people with a mental health care plan.
The Budget measure is designed to help Australians suffering more severe or enduring mental health impacts from the coronavirus pandemic.
Treasurer Josh Frydenberg said the government would release the Productivity Commission’s final mental health report and the interim findings of a study into suicide prevention within weeks.
‘These reports will guide our future actions, working together with states and territories to save lives,’ he told parliament on Tuesday.
If you’re claiming JobKeeper…
The Budget does not contain any changes to the JobKeeper and JobSeeker schemes.
The government has already extended the $86billion JobKeeper scheme until March but is gradually reducing the payments to wean the economy off government support.
From 28 September to 31 December, JobKeeper has been reduced to $1,200 per fortnight for full-time workers and to $750 for people working 20 hours or less per week.
From January to March, the full-time JobKeeper rate will be $1,000 and the part-time rate will reduce to $650.
From 28 September to 31 December, JobKeeper will be reduced to $1,200 per fortnight. Pictured: Shoppers at H&M
The crushing economic blow of the pandemic has been cushioned by extensive wage subsidy programs, such as JobKeeper
The $550 JobSeeker boost has been extended until December 31 at a reduced rate of $250 per fortnight – but workers can earn up to $300 and still claim the benefit.
The Labor Party wants the government to permanently increase the JobSeeker rate – but the treasurer has said he is leaning towards another temporary extension of the boost later this year.
If you drive to work…
The federal government will spend $7.5billion on fast-tracking about 50 road and infrastructure projects across the nation to support 30,000 jobs.
It will splash $750million for a new motorway in Queensland that connects Coomera to Nerang; $560 million for the Singleton bypass on New England Highway in New South Wales; and $528 million for Shepparton and Warrnambool rail line upgrades in Victoria.
The states will also be funding the projects, in many cases matching federal investment.
‘We have been working closely with state and territory governments to invest in the infrastructure that is ready to go and can help rebuild our economy and create more jobs,’ Mr Morrison said.
‘These projects will keep commuters safe on the road, get people home to their loved ones sooner and provide better transport links for urban and regional communities.’
$750million of federal funding will be allocated to the second M1 between Coomera and Nerang. Pictured is an artist’s impression
Deputy Prime Minister Michael McCormack said the building plan will particularly boost regional Australia.
‘We want to ensure our farmers and miners and other businesses can get their world-class goods to market faster and cheaper,’ he said on Monday.
‘That will happen with better roads and better rail, which is why we’re continuing to invest in making our transport corridors more efficient with further investment in infrastructure in this budget.’
Infrastructure: The Key projects
There will be key investments across all states and territories including:
• $560 million for the Singleton Bypass on the New England Highway in New South Wales;
• $528 million for the Shepparton and Warrnambool Rail Line Upgrades in Victoria;
• $750 million for Stage 1 of the Coomera Connector (Coomera to Nerang) in Queensland;
• $88 million for the Reid Highway Interchange with West Swan Road in Western Australia;
• $200 million for the Hahndorf Township Improvements and Access Upgrade in South Australia;
• $150 million for the Midway Point Causeway (including McGees Bridge) and Sorell Causeway as part of the Hobart to Sorell Roads of Strategic Importance corridor in Tasmania;
• $120 million to upgrade the Carpentaria Highway in the Northern Territory; and
• $88 million for the Molonglo River Bridge in the ACT.
Sweeping tax changes in the federal budget next week will make it easier for small businesses to give benefits to their staff. Pictured: A woman makes a coffee in Sydney
Pictured: Shoppers walk through Pitt Street Mall in Sydney’s central business district on Sunday. Mr Frydenberg will be hoping they spend up big
If you’re a skilled migrant…
The budget contains sweeping changes to Australia’s immigration system as the Covid-19 border closure and a declining birth rate hold back population growth.
Deloitte Access Economics predicts there will be 600,000 fewer people in Australia by mid-2022 than if coronavirus had not struck.
The government will continue to welcome skilled immigrants – who benefit the nation by paying taxes – but will update the list of jobs that are eligible for visas.
Immigration Minister Alan Tudge has said the list of industries that are allowed to hire skilled foreign workers will be ‘significantly reduced.’
The National Skills Commission, a new body set up to advise the government during the coronavirus crisis, has helped amend the list based on which industries have skills shortages.
There are currently 242 occupations on the short-term skilled migration list which lets a foreigner stay for two years, including farmers, dog trainers and bishops.
The medium-term skills list currently includes zookeepers. Pictured: Marine mammals unit supervisor Danielle Fox at Taronga Zoo in Sydney
The medium term list – which allows visa holders to apply for permanent residency after three years – has 267 jobs, including nurses, accountants, locksmiths, bricklayers and zookeepers.
The lists were updated as recently as 2018 but the coronavirus pandemic has dramatically altered the economy, with sectors such as healthcare suffering exacerbated skills shortages.
On Thursday the prime minister said he has become ‘frustrated’ at how ‘outdated’ the visa list is.
‘Now the National Skills Commission is identifying where the future opportunities are. That gets plugged into these plans,’ he said.
Visa holders whose job is removed from the list will be allowed to stay in Australia until their visa runs out as long as they keep the same employer.
After the pandemic is over, the occupation list will be altered again to fit the needs of the economy and boost growth.
The short-term skills list currently includes archbishops. After the pandemic is over, the occupation list will be altered again to fit the needs of the economy and boost growth
As of March this year, there were 139,331 skilled visa holders in Australia, which is about one per cent of the working population.
That figure is expected to have declined significantly as Australia’s tough border controls prevent foreigners entering the country.
Total immigration is predicted to drop to just 36,000 in 2020-21, down from 240,000 in 2018-19, due to the impact of coronavirus.
That would be Australia’s lowest population increase in more than 40 years, posing a major threat to economic growth which is strongly linked to population growth.
Residents in Sydney are seen entering Martin Place train station during the coronavirus pandemic
If you work in manufacturing…
The government will invest $1.5billion in Aussie manufacturing under a new 10-year plan to strengthen the industry which employs 860,000 Australians.
It will focus on six areas of manufacturing that Australia is good at which are defence; recycling and energy; space; food and drink; medicine; and resources technology and critical minerals processing.
Companies in those six industries will be able to apply for government grants that must be backed up by private investment to prove they are worthy.
Scott Morrison will invest $1.5billion in Aussie manufacturing under a new 10-year plan to strengthen the industry which employs 860,000 Australians. Industries targeted will include food and drink (pictured is milk being packaged)
The cash will help companies expand, develop new ideas and access international markets as the nation recovers from Covid-19.
Before the pandemic manufacturing was worth $100billion each year and generated more than $50billion in exports.
Mr Morrison believes the industry is crucial to economic growth, particularly in regional areas such the Hunter region of NSW and north and central Queensland.
The government will also splash $107million on a new Supply Chain Resilience Initiative to make sure Australia is never without crucial supplies after coronavirus left countries scrambling to secure masks and protective gear.
Treasurer Josh Frydenberg is seen at Parliament House Tuesday morning ahead of the Federal Budget
If you live in or own a granny flat…
The government will extend the capital gains tax exemption on main residences to apply to granny flats occupied by a relative.
Currently homeowners may have to pay the tax on the sale of a granny flat if they have a written agreement with a relative who lives in it.
The government fears this prompts families to make informal agreements, leaving elderly people open to financial abuse and exploitation after a family or relationship breakdown.
The government will extend the capital gains tax exemption on main residences to apply to granny flats occupied by a relative
Treasurer Josh Frydenberg said waiving the tax would better protect seniors and save money for mum and dad investors.
The change is due to kick in on July 1 next year, subject to the passage of legislation.
It will only apply to agreements that are entered into because of family relationships or other personal ties and will not apply to commercial rental arrangements.
If you’re looking to buy a home…
Buying a home is set to get a lot easier with potential borrowers no longer needing to provide a bank intimate details of their everyday spending habits.
Under existing rules introduced in 2009, banks are required to scrutinise the daily spending of potential borrowers to determine if they would be reliable.
Mr Frydenberg said these rules had discouraged Australians from borrowing, despite interest rates being at a record-low of 0.25 per cent.
‘Responsible lending has become restrictive lending,’ he said.
Buying a home is set to get a lot easier with potential borrowers no longer needing to provide a bank intimate details of their everyday spending habits. Pictured: A Brisbane house auction
The Treasurer is scrapping of key elements of the National Consumer Credit Protection Act, which Kevin Rudd’s Labor government introduced in 2009 at the height of the Global Financial Crisis.
The government regards these 11-year-old responsible lending laws, designed to weed out unsuitable borrowers, as a risk in a slowing economy.
The government’s changes are set to put the onus on borrowers to tell the truth about their spending instead of forcing banks to heavily scrutinise their customers through intrusive questioning or third-party credit data groups.
This is designed to speed up home and credit approvals in a bid to encourage spending during a recession.
In September the government announced that millions of homes and businesses will gain access to ultra-fast internet under a $4.5 billion upgrade to the national broadband network
If you’re struggling with your internet connection…
In September the government announced that millions of homes and businesses will gain access to ultra-fast internet under a $4.5billion upgrade to the national broadband network.
At least eight million premises should have speeds of up to one gigabit per second by 2023.
The upgrade will be financed through NBN Co borrowing from private debt markets.
Communications Minister Paul Fletcher said with 99 per cent of premises now able to connect to the NBN, the time was right to upgrade the network.
Mr Fletcher said the coronavirus pandemic had also changed the way people used the internet and highlighted the need for speed.
He appears to be laying the groundwork to sell the government-owned NBN Co during the next term of parliament, should the coalition retain office.
A Vodafone worker is seen inside a store for the phone and data provider in Sydney’s CBD
If you’re a struggling small business…
The government wants to give more control to small businesses facing financial hardship to protect then from being wound up.
Drawing on key features of bankruptcy laws used in the United States, the treasurer wants businesses to work with an insolvency practitioner to come up with a plan to repay accumulating debts over time, rather than handing over the keys to an administrator and seeing their assets sold.
Scott Morrison (pictured in his office in Canberra) has said Tuesday’s budget is the most important since World War Two
‘Many businesses who are doing it tough through the Covid crisis because of health restrictions, they have had to close their doors but the liabilities have kept building up.
‘The focus is to give those business owners more control as they deal with these liabilities,’ Mr Frydenberg said last month.
The change will apply to businesses with liabilities of less than $1million, about 76 per cent of small businesses which are insolvent.
The planned changes follow the extension of temporary insolvency protections to support small businesses impacted by Covid-19.
If you work in regional tourism…
The budget will set aside $50million for a regional tourism recovery initiative to assist businesses in regions heavily reliant on international tourism.
Federal Tourism Minister Simon Birmingham said tourism regions had been hit hard by the Covid-19 pandemic and border closures.
This additional funding will help them to bounce back by firstly attracting more Australians and then overseas visitors when international borders reopen, he said.
In year to June 30 the economy took a 6.3 per cent hit, the worst figure since the depths of the Great Depression when it shrank by about 10 per cent, and a greater contraction than after the Second World War in 1945 when growth tumbled by 5.1 per cent as troops returned home
‘Tourism is such an important job creator and driver of many regional economies,’ Senator Birmingham said in a statement.
‘We want to make sure that our tourism regions are in the best possible shape on the other side of the Covid-19 pandemic.’
John Hart, executive chair of the Australian Chamber of Commerce and Industry, Tourism, said the package provides some hope for the region’s worst affected companies.
‘This fund will help address the great divide in tourism between the regions that have been able to capitalise on some intrastate visitation and those that have not,’ he said in a statement.
If you work in renewable energy…
The government has outlined plans to spend $18billion on new energy technology to help stop climate change and support 130,000 jobs over the next ten years.
It will target five technologies including including hydrogen fuel, electricity storage, low carbon steel, carbon capture and soil carbon.
The government will spend $18billion on research and development and expects the private sector and state governments to invest three to five times that amount, taking total investment to at least $50billion.
Energy Minister Angus Taylor will identify the technologies he will target, including hydrogen and electricity storage (pictured is a computer-generated image of battery storage)
Some $30billion has been invested in renewable energy in Australia since 2017, with dozens of solar power and wind farms popping up around the country.
But Mr Morrison wants to do more to support newer technologies to drive down power bills, create jobs and reduce emissions.
The centerpiece of Mr Morrison’s plan is to build a giant hydrogen export hub worth $70million where the gas can be shipped to countries around the world including Japan, South Korea, Singapore and Germany.
ScoMo’s green energy revolution
Hydrogen: Can be used to heat buildings, power factories and even run cars with no emissions
Electricity storage: Huge batteries can store energy generated by solar and wind power so it can be released at peak times
Low carbon materials: Steel and aluminium made by burning hydrogen instead of coal to reduce carbon emissions
Carbon capture: The process of capturing carbon dioxide from factories and power stations and storing it underground
Soil carbon: Growing more plants and trees to return carbon from the air to the soil
The government will also spend $67million on microgrid deployment projects in regional and remote communities across Australia.
Microgrids are set up by farmers and mining companies to generate electricity using solar panels and batteries instead of diesel generation. Farms on the NSW Central Coast have been deploying them to reduce their energy costs.
The prime minister has announced a $52million package of measures to help companies become more energy efficient with new air-conditioning or roof solar panels.
Some $12million of this will go to community organisations and another $12million will go to regional pubs.
The government will also set up a $50million Carbon Capture Use and Storage Development Fund which will pay for projects to capture carbon emissions.
Carbon capture involves trapping carbon dioxide released from factories and power stations, transporting it on ships or in pipelines and pumping it down into depleted oil and gas fields.
Scientists believe carbon capture can potentially stop half the world’s carbon emissions from being released into the atmosphere.
Potential locations to store the carbon include Moomba in South Australia, the Surat/Bown Basins in Queensland, offshore at Latrobe Valley in Victoria, offshore at Darwin, the Pilbara/Carnarvon Basin in WA and Browse in WA.
A new plant in the Hunter Valley would replace power generated by the Liddell Coal plant (pictured) which is due to close in 2023
As part of the government’s plan, the Australian Renewable Energy Agency will be handed $1.4billion over the next ten years and will be allowed to invest in new technologies such as soil carbon sequestration, carbon capture and storage and the production of green steel, which is made using hydrogen instead of coal.
Meanwhile, Mr Morrison stands ready to build a new gas-fired power station in the New South Wales Hunter Valley to keep power prices down as Australia emerges from the coronavirus-caused recession.
The prime minister wants to reform the gas market to stop Aussies getting ripped off while major producers send $49billion of gas a year overseas, mainly to Japan, China and South Korea.
He will require energy companies in New South Wales to makes plans to produce 1000MW of power by April 2021 – and if they don’t he will step in and build a new gas-fired power station at Kurri Kurri in the NSW Hunter Valley.
If you’re a child abuse victim…
The government will provide funding to settle claims brought outside of the National Redress Scheme relating to institutional child abuse claims in the Australian Capital Territory and Northern Territory prior to self-government.
The government will provide $6.7 million over four years from 2020-21 to establish a National Memorial for victims and survivors of institutional child sexual abuse. The National Memorial will provide a place for healing, reflection and recognition of the victims, survivors and those affected by institutional child sexual abuse.
If you’re a foreign criminal…
A Christmas Island detention centre is going to be re-opened to house foreign criminals who can’t be deported due to COVID border restrictions.
The government will provide $55.6 million in 2020-21 to reactivate the immigration detention facility at North West Point.
The huge tax changes coming to small businesses in 2020 budget
Businesses with an aggregated annual turnover between $10million and $50million will have access to up to ten small business tax concessions. The changes are estimated to support about 20,000 businesses and 1.7million employees.
Immediate deduction for certain start-up expenses
From 1 July 2020, eligible businesses can immediately deduct a range of professional expenses and Australian government agency payments associated with starting a new business, such as professional, legal and accounting advice. Currently, these costs are usually deducted over a five year period.
Immediate deduction for certain prepaid expenditure
From 1 July 2020, eligible businesses can immediately deduct certain prepaid expenditure where the payment covers a period of 12 months or less that ends in the next income year. Currently, business expenditure that relates to multiple income years is generally not immediately deductible.
Fringe benefits tax (FBT): small business car parking exemption
From 1 April 2021, eligible businesses would be exempt from FBT on car parking benefits provided to employees if the parking is not provided in a commercial car park.
FBT: multiple work-related portable electronic devices exemption
From 1 April 2021, eligible businesses would be exempt from FBT on multiple work-related portable electronic devices provided to employees – even if the devices have substantially identical functions.
Simplified trading stock rules
From 1 July 2021, eligible businesses can choose to use a simplified trading stock regime. Under this regime, eligible businesses may choose not to conduct a stocktake (and account for changes in the value of trading stock) for an income year, if the difference between the opening value of stock on hand and a reasonable estimate of stock on hand at the end of the year does not exceed $5,000.
Pay as you go (PAYG) instalments based on GDP-adjusted notional tax
From 1 July 2021, eligible businesses would have the option to have their PAYG instalments calculated for them by the ATO (based on previously reported information).
Currently, they are required to calculate their actual income for the period, as the basis for their PAYG instalment calculation.
Small business excise concession
From 1 July 2021, eligible businesses would be able to apply to defer settlement of excise duty to a monthly reporting cycle, instead of the current weekly reporting cycle. This only applies to eligible goods under the current small business entity concession.
Small business excise-equivalent customs duty concession
From 1 July 2021, eligible businesses would be able to apply to defer settlement of excise-equivalent customs duty from a weekly to monthly reporting cycle. This only applies to eligible goods under the current small business entity concession.
Two-year amendment period
From 1 July 2021 eligible businesses (excluding entities with significant international tax dealings or particularly complex affairs) will have a two year amendment period apply to income tax assessments for income years. The current exceptions, including for fraud or evasion, would continue to apply. Businesses can lodge an amendment application before the time limit and the ATO may extend the time limit to give effect to the application. Currently, they are subject to a four-year amendment period.
Simplified accounting methods
From 1 July 2021, the Commissioner of Taxation’s power to create a simplified accounting method determination for eligible businesses for GST purposes will be expanded to apply to businesses below the $50 million aggregated annual turnover threshold.
Remove fringe benefits tax for retraining (applies to all companies)
From 2 October 2020 the government will remove the 47 per cent fringe benefits tax on retraining provided by employers to redundant, or soon to be redundant, employees.
This will encourage employers to help workers transition to new employment opportunities within or outside their business.