Federal government economic response to COVID-19

Practical Law ANZ Legal Update w-024-6109 (Approx. 28 pages)

Federal government economic response to COVID-19

by Practical Law Corporate

Federal government economic response to COVID-19

On 23 March 2020, the federal government introduced a legislative package comprising various Acts to effect its first and second economic responses to COVID-19, announced between 12 and 22 March 2020. The government has stated that this package totals $189 billion across the forward estimates, representing 9.7% of annual GDP (see the Treasury website). Legislation to effect these measures passed both Houses of Parliament on 23 March 2020 and received Royal Assent on 24 March 2020.
On 30 March 2020, the federal government announced a third economic stimulus package, which is a subsidy program to support employers and businesses affected by the outbreak of COVID-19 (the JobKeeper Scheme). Generally speaking, the JobKeeper Scheme allows eligible employers (including sole traders) significantly impacted by the COVID-19 outbreak to access a subsidy from the government to continue paying their employees. The subsidy will be $1,500 per fortnight per employee for up to six months. The government has stated that the JobKeeper Scheme totals $130 billion. Legislation to effect the JobKeeper Scheme was passed by both Houses of on 8 April 2020 and received Royal Assent on 9 April 2020 and on 9 April 2020, the Treasurer made the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (Cth), which establish the JobKeeper Scheme and specify details about the scheme. For more information on the JobKeeper Program, see also Help and information note, JobKeeper Payment. For all of Practical Law Employment's resources relating to the JobKeeper Program, see the Practical Law website.

(together the Stimulus Package.)

This legal update contains a summary of the measures contained in the Stimulus Package with links to Practical Law resources where relevant.

As the COVID-19 outbreak in Australia is a rapidly developing situation, new federal legislative responses may be announced. Practical Law is continuously monitoring all new developments and will continue to update this legal update as and when economic stimulus measures are passed by parliament.

For more information on each of the federal, state and territory government responses to COVID-19, see:

Checklist, COVID-19: Key Australian legislation and legislative instruments to 3 March 2021, which contains a streamlined, historical overview of the key legislation and regulations in response to the COVID-19 outbreak to 3 March 2021.
Checklist, COVID-19: archive: Key Australian legislation and legislative instruments to 11 December 2020, which contains information on the key legislative developments that occurred in 2020 relating to the emergency response to the COVID-19 outbreak in Australia.

The Stimulus Package Acts

The Stimulus Package comprises the following Acts:

(collectively, the Stimulus Package Acts.)

For a summary of the operative effect of the Stimulus Package Acts, see Summary of Stimulus Package Acts.

Broadly, the Stimulus Package provides support for:

Individuals and households (see Measures to support individuals and households).
Business (see Measures to support businesses).
The flow of credit (see Measures to support the flow of credit).
Continued employment (see JobKeeper Scheme).
Documentary and witnessing requirements (see "Modification of information and other requirements" in Summary of Stimulus Package Acts)).

Some of the key measures in the Stimulus Package include:

The provision of temporary relief for financially distressed entities. In particular, the Stimulus Package provides temporary relief for directors from any personal liability for trading while insolvent and provides temporary flexibility in the Corporations Act 2001 (Cth) (CA 2001) to provide temporary and targeted relief from provisions of the CA 2001 to deal with unforeseen events that arise as a result of the COVID-19 pandemic.
A temporary increase to the threshold at which creditors can issue a statutory demand on a company, from $2,000 to $20,000. The time companies have to respond to statutory demands will also be extended from 21 days to six months.
Tax-free payments of up to $100,000 for eligible small- and medium-sized entities (SMEs), and not-for-profits (NFPs) (including charities) that employ people, with a minimum payment of $20,000.
A job-seeker supplement of $550 per fortnight.
Two separate $750 payments to social security, veteran and other income support recipients and eligible concession card holders.
For individuals in financial distress, early access to a tax-free payment up to $10,000 from their superannuation in 2019 to 2020, and a further $10,000 in 2020 to 2021.
An SME guarantee scheme to support SMEs to get access to working capital.
The JobKeeper Scheme, which allows eligible employers (including sole traders) significantly impacted by the COVID-19 outbreak to access a subsidy from the government to continue paying their employees.

Measures to support individuals and households

The Stimulus Package contains a number of measures to support individuals and households. They include payments to social security, veteran and other income support recipients, early access to superannuation and income support for individuals, including job seekers.

Payments to social security, veteran and other income support recipients

The Stimulus Package includes two one-off payments to social security, veteran and other income support recipients, as follows:

The first payment will be available to people who are eligible payment recipients and concession card holders at any time from 12 March 2020 to 13 April 2020 inclusive.
The second payment will be available to people who are eligible payment recipients and concession card holders on 10 July 2020.

A person can be eligible to receive both a first and second support payment. However, they can only receive one $750 payment in each round of payments, even if they qualify in each round of the payments in multiple ways.

For more information, see Treasury fact sheet: Payments to support households.

Early access to superannuation

Eligible individuals will be able to apply to access up to $10,000 of their superannuation before 1 July 2020. They will also be able to access up to a further $10,000 from 1 July 2020 for approximately three months. People accessing their superannuation will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink or Veterans ' Affairs payments.

For more information, including eligibility requirements, see Treasury fact sheet: Early Access to Super.

Support for retirees

The annual superannuation minimum drawdown requirements for account-based pensions and similar products will be reduced by 50% for 2019 to 2020 and 2020 to 2021. This measure will benefit retirees by providing them with more flexibility as to how they manage their superannuation assets.

For more information, see Treasury fact sheet: Providing support for retirees to manage market volatility.

Income support for individuals

The government is temporarily expanding eligibility to income support payments and establishing a new, time-limited COVID-19 supplement to be paid at a rate of $550 per fortnight. This supplement will be paid to both existing and new recipients of the eligible payment categories. The changes will apply six months from 24 March 2020.

For more information, including who is eligible for the expanded income support payments, see Treasury fact sheet: Income support for individuals.

Increased bankruptcy threshold and extension of time to respond to bankruptcy notice

The Stimulus Package temporarily:

Increases the threshold for the minimum amount of debt required for a creditor to initiate bankruptcy proceedings against a debtor from its current level of $5,000 to $20,000.
Extends the time that a debtor has to respond to a bankruptcy notice from 21 days to six months. The extension will give a debtor more time to consider repayment arrangements before they could be forced into bankruptcy.

These measures will apply for six months from 24 March 2020.

For more information, see:

For more information on bankruptcy notices generally, see Checklist, Issuing, serving and setting aside a bankruptcy notice.

Measures to support businesses

The Stimulus Package introduces a number of measures to support businesses during the COVID-19 crisis, including:

Temporary relief for financially distressed businesses.
Support for business investment.
Cash flow assistance for businesses.

Temporary relief for financially distressed businesses

Measures designed to support financially distressed entities include:

A temporary increase in the threshold at which creditors can issue a statutory demand on a company and the time companies have to respond to statutory demands they receive (see Increased statutory demand threshold and extension of time in which to respond).
A temporary increase in the threshold for a creditor to initiate bankruptcy proceedings, an increase in the time period for debtors to respond to a bankruptcy notice, and extending the period of protection a debtor receives after making a declaration of intention to present a debtor's petition (see Increased statutory demand threshold and extension of time in which to respond and Increased bankruptcy threshold and extension of time to respond to bankruptcy notice).
Temporary relief for directors from any personal liability for trading while insolvent (see Protection for directors from personal liability for insolvent trading).
Providing temporary flexibility in the Corporations Act 2001 to provide targeted relief for companies from provisions of the Act to deal with unforeseen events that arise as a result of the Coronavirus health crisis (see Temporary measures to provide flexibility within the Corporations Act).

In addition, the government notes that for owners or directors of a business that are currently struggling due to COVID-19, the ATO will tailor solutions for their circumstances, including temporary reduction of payments or deferrals, or withholding enforcement actions including Director Penalty Notices and wind-ups.

For more information on these measures, see Treasury fact sheet: Providing temporary relief for financially distressed businesses.

Protection for directors from personal liability for insolvent trading

As part of the Stimulus Package, there will be a temporary six-month "safe harbour" period in which directors are relieved from the duty to prevent insolvent trading. It is referred to as a "new safe harbour" (separate to the existing statutory safe harbour that applies in under normal circumstances). The temporary measures mean that a director will not be personally liable for incurring a debt while the company is insolvent if the debt is incurred:

In the ordinary course of the company's business.
During:
- the 6-month period that starts on the commencement of the Stimulus Package Acts; or
- any longer period that may be prescribed by the regulations for the purposes of the changes to the insolvent trading provisions; and
before any appointment during that period of an administrator or liquidator of the company.

A debt will be incurred in the ordinary course of the company's business where "it is necessary to facilitate the continuation of the business" during the six-month period commencing when the amendments commence. This could include:

A director taking out a loan to move some business operations online.
Debts incurred through continuing to pay employees during the COVID-19 pandemic.

The onus of establishing the protection of the new "temporary safe harbour" is borne by the relevant director seeking the protection, who must provide evidence that suggests a reasonable possibility that they have complied with the requirements necessary for protection.

For more information about the temporary safe harbour, see:

For more information about the ordinary safe harbour provisions under the CA 2001, see Practice note, Corporate insolvency and related directors ' duties: Safe harbour exception to insolvent trading.

Increased statutory demand threshold and extension of time in which to respond

To assist companies, the Stimulus Package temporarily:

Increases the statutory minimum debt(s) based on which a creditor can issue a statutory demand from $2,000 to $20,000.
Extends the period within which the company may respond from 21 days to six months.

For more information, see:

These measures will apply for six months from 24 March 2020.

For more information on statutory demands, see Toolkit, Statutory demands and winding up applications.

Temporary measures to provide flexibility within the Corporations Act

As part of the Stimulus Package, the Treasurer will be given a temporary instrument-making power in the CA 2001 to temporarily amend provisions of the CA 2001 to provide relief from specific obligations or to modify obligations to enable compliance with legal requirements during the COVID-19 crisis. The instrument-making power will apply for six months from 24 March 2020 and any instrument made under this power will apply for up to six months from the date it is made.

Under this power, the Treasurer may, for example, grant relief to public companies that would otherwise be required to hold their annual general meeting (AGM) during the COVID-19 crisis. The relief could be an extension of time in which the company must hold its AGM or, relief to enable the company to hold an entirely virtual AGM.

While the Australian Securities and Investments Commission (ASIC) has issued a no-action position regarding the time in which entities with a 31 December 2019 balance date must hold their AGMs and virtual meetings (see ASIC Media Release 20-068MR (20 March 2020)), an instrument made by the Treasurer under this instrument-making power would give companies further certainty during the COVID-19 crisis. For more information on shareholder meetings and the COVID-19 crisis, see Checklist, COVID-19 implications for AGMs and other shareholder meetings to 30 March 2021 and Practice note, General meetings: Holding a general meeting during a public health emergency.

Support for business investment

To support business investment, the government is:

Increasing the instant asset write-off (IAWO) threshold from $30,000 to $150,000 and expanding access to include all businesses with aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020. In 2017 to 2018 there were more than 360,000 businesses that benefited from the current IAWO, claiming deductions to the value of over $4 billion. The higher IAWO threshold provides cash flow benefits for businesses that will be able to immediately deduct purchases of eligible assets each costing less than $150,000. The threshold applies on a per asset basis, so eligible businesses can immediately write off multiple assets.
Introducing a time limited 15-month investment incentive to support business investment and economic growth over the short-term, by accelerating depreciation deductions. The key features of the incentive are as follows:
- a deduction of 50% of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset's cost;
- businesses with aggregated turnover below $500 million are eligible; and
- assets that are eligible include new assets that can be depreciated under Division 40 of the Income Tax Assessment Act 1997 (Cth) (ITAA 1997) (that is, plant, equipment and specified intangible assets, such as patents) acquired after announcement and first used or installed by 30 June 2021. The measure does not apply to second-hand Division 40 assets, or buildings and other capital works depreciable under Division 43 of the ITAA 1997.

Cash flow assistance for businesses

Under the Stimulus Package:

Eligible SMEs and NFPs (including charities) that employ people will receive a tax-free payment up to $100,000, with a minimum payment of $20,000. These payments seek to help businesses' and NFPs' cash flow so they can keep operating, pay their rent, electricity and other bills and retain staff.
Employers will receive a payment equal to 100% of their salary and wages withheld, with a maximum payment of $50,000 and a minimum payment of $10,000.

(The Boosting Cash Flow Payments.)

SMEs and NFPs (including charities) with aggregated annual turnover under $50 million and that employ workers are eligible for the cash flow assistance and the cash flow payments will be available from 28 April 2020.

Additionally, in the July to October 2020 period, entities that were eligible for the Boosting Cash Flow Payments will receive an additional payment equal to the total of all payments received.

For more information, see Treasury fact sheet: Cash flow assistance for businesses.

Support for apprentices

Eligible employers that employ apprentices and trainees can also apply for a wage subsidy of 50% of the apprentice's or trainee's wage paid during the nine 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.

Employers will be reimbursed up to a maximum of $21,000 per eligible apprentice or trainee ($7,000 per quarter).

For more information, see Treasury fact sheet: Cash flow assistance for businesses.

Measures to support the flow of credit

To support the flow of credit, the government is creating an SME guarantee scheme (Scheme) under which, the government will provide a guarantee of 50% to SME lenders for new unsecured loans to be used for working capital. This is designed to enhance these lenders' willingness and ability to provide credit, which will result in SMEs being able to access additional funding to help support them through the upcoming months. SMEs with a turnover of up to $50 million will be eligible to receive these loans.

The government will provide eligible lenders with a guarantee for loans with the following terms:

Maximum total size of loans of $250,000 per borrower.
The loans will be up to three years, with an initial six-month repayment holiday.
The loans will be in the form of unsecured finance, meaning that borrowers will not have to provide an asset as security for the loan.

Loans will be subject to lenders' credit assessment processes with the expectation that lenders will look through the cycle to sensibly take into account the uncertainty of the current economic conditions. As part of the loan products available, the government will encourage lenders to provide facilities to SMEs that only have to be drawn if needed by the SME. This will mean that the SME will only incur interest on the amount they draw down. If they do not draw down any funds from the facility, no interest will be charged, but they will retain the flexibility to draw down in the future should they need to.

The Scheme will commence by early April 2020 and be available for new loans made by participating lenders until 30 September 2020.

For more information, see Treasury fact sheet: Supporting the flow of credit.

Support for severely affected regions

The government has set aside an initial $1 billion to support those regions, communities and industries that have been disproportionately affected by the economic impacts of COVID-19, including those heavily reliant on industries such as tourism, agriculture and education. The $1 billion will be spent through existing or newly established government programs or initiatives. As an initial measure, the government will waive the Environmental Management Charge for tourism businesses that operate in the Great Barrier Reef Marine Park. The $1 billion fund will also be used to provide additional assistance to help businesses identify alternative export markets or disrupted supply chains. Targeted measures will also be developed to further promote tourism.

For more information, see Treasury fact sheet: Assistance for severely affected regions and sectors.

Coronavirus Business Liaison Unit

Treasury has also created the Coronavirus Business Liaison Unit (Unit). Treasury states that the Unit is engaging with peak business and industry groups on systemic issues arising from COVID-19 to ensure these are being brought to the attention of the government. The Unit is hearing from business on a regular basis and providing updates to the government, focusing on crucial issues where the government may be able to undertake additional work to support what business is doing.

JobKeeper Scheme

Extension of JobKeeper Scheme

On 21 July 2020, the federal government announced it will extend the JobKeeper Scheme until 28 March 2021 at a reduced rate, subject to certain key modifications to employer entity eligibility and the quantum of the fortnightly payment.

For an employer entity (including business participants and not-for-profits), to be eligible for the JobKeeper Payment from:

28 September 2020 to 3 January 2021 (phase one), it must meet the relevant continuing decline in turnover test in both the June and September 2020 quarters.
4 January 2021 to 28 March 2021 (phase two), it must meet the relevant continuing decline in turnover test in each of the June, September and December 2020 quarters.

During:

Phase one, the fortnightly JobKeeper Payment will be reduced to $1,200 pre-tax for all eligible employees who, in the four weeks before 1 March 2020, worked for the eligible employer entity an average of 20 hours or more per week, and $750 pre-tax for all other eligible employees.
Phase two, the fortnightly JobKeeper Payment will be further reduced to $1,000 pre-tax for all eligible employees who worked for the employer entity an average of 20 hours or more per week (using the same four-week testing period), and $650 pre-tax for all other eligible employees.

Employee (or business participant) eligibility remains unchanged. The ATO will continue to pay the JobKeeper Payment in arrears.

The extension of the JobKeeper Scheme beyond 27 September is expected to require legislative amendments once the federal Parliament resumes from 24 August 2020. Practical Law is continuously monitoring all new developments and will update its content as and when the anticipated amending legislation and related instruments are passed or made. For more information, see the Treasury's Economic Response to the Coronavirus JobKeeper extension fact sheet: Extension of the JobKeeper Payment (21 July 2020).

For more information, see Legal update: archive, Jobkeeper payment scheme extended, with entity eligibility rules modified and quantum of fortnightly payment reduced.

On 30 March 2020, the Federal government announced the JobKeeper Payment Program, which allows eligible employers (including sole traders) significantly impacted by the COVID-19 outbreak to access a subsidy from the government to continue paying their employees (JobKeeper Payment). The JobKeeper Payment will be $1,500 per fortnight per employee for the period 30 March 2020 to 27 September 2020. The JobKeeper scheme is effected by the Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020 (Cth) and the Coronavirus Economic Response Package (Payments and Benefits) Act 2020 (Payment and Benefits Act), which were passed by both houses of Parliament on 8 April 2020 and received Royal Assent on 9 April 2020. For a summary of these Bills, see Summary of Stimulus Package Acts.

Broadly, the Payment and Benefits Act establishes a framework to administer the JobKeeper Payment. Section 20(1) of the Payment and Benefits Act provides that the Treasurer may make rules prescribing matters required or permitted by that Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act. Accordingly, on 9 April 2020, the Treasurer made the Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (Cth) (JobKeeper Rules), which establish the JobKeeper Scheme and specify details about the scheme, including:

The start and end date of the scheme, with payments made fortnightly starting 30 March 2020 and ending 27 September 2020.
When an employer or business is entitled to a payment (see Eligibility for JobKeeper Scheme).
The amount and timing of a payment (see The JobKeeper Payment).
Other matters relevant to the administration of the JobKeeper Scheme.

Eligibility for JobKeeper Scheme

Broadly, entities that carry on a business at 1 March 2020 or a charity that "pursued its objectives" at that time will qualify for the JobKeeper scheme if they have suffered a decline in turnover as follows:

ACNC-registered charities – 15% reduction in turnover.
Entities with turnover less than $ 1billion – 30% reduction in turnover.
Entities with turnover greater than $1 billion – 50% reduction in turnover.

(Eligible Businesses.)

See Decline in turnover.

A business may be entitled to the JobKeeper Payment for the business owner or a nominated owner regardless of whether the business has employees who would be eligible to receive the payment. Eligible Businesses that have stood down their employees before the commencement of this scheme will be able to participate. Employees that are re-engaged by a business that was their employer on 1 March 2020 will also be eligible. Eligible employers must elect to participate in the JobKeeper Payment Program by making an application to the ATO.

The following entities are, however, specifically excluded from the JobKeeper Scheme:

Entities subject to the Major Bank Levy (see the Parliament of Australia website).
Australian government agencies.
Local governing bodies.
Sovereign entities.
Companies to which a liquidator or provisional liquidator has been appointed.
Individuals in circumstances where a trustee in bankruptcy has been appointed to the individual’s property.

For more information, see Help and information note, JobKeeper Payment: Eligible employers.

Eligible employees include employees of Eligible Businesses who:

On 1 March 2020:
- were aged 16 years or over;
- were an employee other than a casual employee of the employer, or were long-term casual employees of the employer; and
- were an Australian resident (within the meaning of section 7 of the Social Security Act 1991 (Cth)), or were a resident of Australia for the purposes of the Income Tax Assessment Act 1936 and were the holder of a Subclass 444 (Special Category) visa.
During the fortnight to which the JobKeeper Payment relates (see The JobKeeper Payment):
- were employees of the Eligible Business;
- were not excluded from being an Eligible Employee (the exclusions relate to recipients of parental leave pay and dad and partner pay under the Paid Parental Leave Act 2010 (Cth), and specified recipients of workers' compensation).

(Eligible Employees.)

For more information, see Help and information note, JobKeeper Payment: Eligible employees

Decline in turnover

The relevant decline in turnover is determined by a decline in turnover test set out in the JobKeeper Rules that is linked to the GST turnover test in Division 188 of the A New Tax System (Goods and Services Tax) Act 1999 (Cth), in particular, the projected GST turnover. Generally speaking, an entity can satisfy the decline in turnover test by comparing its projected GST turnover for a period (the turnover test period) with its current GST turnover as calculated for a relevant comparison period (the comparison turnover). In effect, this compares a month or quarter in the period the JobKeeper Scheme applies with the corresponding period in 2019. A business will generally satisfy the test where the GST turnover in the turnover test period falls short of the comparison turnover and the shortfall meets the applicable decline in turnover for that business. This is set out in Division 2 of Part 2 of the JobKeeper Rules. If a business cannot use this basic calculation, the Commissioner may allow an alternative calculation. This may be relevant, for example, where the business is a new business with no comparable 2019 turnover period or where the business has made a major acquisition since the comparable period in 2019.

Eligible Businesses must elect to participate in the JobKeeper Scheme by notifying the Commissioner in the approved form. For more information, see the ATO website: JobKeeper Payment.

The JobKeeper Payment

Eligible Businesses will receive a fixed payment of $1,500 per fortnight per Eligible Employee if they meet the following requirements:

The fortnight is a JobKeeper fortnight, being a fortnight between 30 March 2020 and 27 September 2020.
The employer is an Eligible Business on or before the end of the fortnight.
The payment is for a person who is an Eligible Employee of the employer;
The employer has satisfied the wage condition by making payments to the Eligible Employee equal to or greater than the amount of JobKeeper Payment (less PAYG withholding and salary packaging) that the employer will receive for the employee for the fortnight.
The employer has notified the Commissioner of a range of matters, including notification of its election to participate in the JobKeeper Scheme.

For more information, see Help and information note, JobKeeper Payment: Payment Process.

For more information on the JobKeeper Scheme and Payment generally, see the Treasury website and the following Treasury fact sheets :

Summary of Stimulus Package Acts

The following table provides a high-level summary of the operative effect of the Stimulus Package Acts.

Legislation	Description and details
Coronavirus Economic Response Package Omnibus Act 2020	This Act amends or repeals a wide range of legislation cited in a series of schedules.
Schedule 1 – Enhancing the Instant Asset Write-Off	Amends the Income Tax Assessment Act 1997 and Income Tax (Transitional Provisions) Act 1997 (the income tax law) to: Increase the cost threshold below which small business entities can access an immediate deduction for depreciating assets and certain related expenditure (instant asset write-off) from $30,000 to $150,000, from 12 March 2020 to 30 June 2020; Provide access to an instant asset write-off to entities with an aggregated turnover of $10 million up to $500 million (up from the existing cap of $50 million); and Make the instant asset write-off available for depreciating assets and certain related expenditure costing less than $150,000, from 12 March 2020 to 30 June 2020.
Schedule 2 – Backing business investment	Amends the income tax law to temporarily allow businesses with aggregated turnovers of less than $500 million in an income year to deduct capital allowances for depreciating assets at an accelerated rate, where the depreciating asset: Is new and has not previously been held by another entity (other than as trading stock or for testing and trialling purposes); Is an asset for which an entity has not claimed depreciation deductions, including under the instant asset write-off rules; and Is first held, and first used or installed ready for use, for a taxable purpose between 12 March 2020 and 30 June 2021 (inclusive). Different rules apply depending on whether or not an entity is using the simplified rules for capital allowances for small businesses.
Schedule 3 – Boosting cash flow for employers	Makes consequential amendments to the Income Tax Assessment Act 1997, Social Security Act 1991, Taxation Administration Act 1953 and Veterans' Entitlements Act 1986 arising from the Employers (Coronavirus Economic Response Package) Act 2020.
Schedule 4 –Stimulus payments to households to support growth	Provides for the payment of: A first economic support payment of $750 to approximately 6.6 million Social Security and Veterans' income support recipients, Farm Household Allowance recipients, Family Tax Benefit recipients and holders of a Pensioner Concession Card, Commonwealth Seniors Health Card or Commonwealth Gold Card. A second economic support payment of $750 to Social Security and Veterans' income support recipients, Family Tax Benefit recipients and holders of a Pensioner Concession Card, Commonwealth Seniors Health Card or Commonwealth Gold Card who receive a qualifying payment or hold a qualifying concession card on 10 July 2020. This second payment will not be paid to a person who receives, on 10 July 2020, the new coronavirus supplement established by this Act.
Schedule 5 – Delegation power for the Director of Human Biosecurity	Amends the Biosecurity Act 2015 (Biosecurity Act) to enable the Director of Human Biosecurity to delegate their function or powers under Part 3 of Chapter 2 (human biosecurity control orders) of the Biosecurity Act.
Schedule 6 – Environmental Management Charge	Schedule 6 amends the Great Barrier Reef Marine Park Regulations 2019 to temporarily waive the environmental management charge (that would otherwise ultimately be collected by the Great Barrier Reef Marine Park Authority) from 1 April 2020 to 31 December 2020.
Schedule 7 – Assistance for apprentices and trainees and the aviation sector	Amends Schedule 1AB to the Financial Framework (Supplementary Powers) Regulations 1997 to establish legislative authority for government spending on new measures to assist employers to retain apprentices and trainees, and to provide financial assistance to participants in the Australian aviation sector to assist with the impact on the sector of the coronavirus.
Schedule 8 – Providing flexibility in the Corporations Act	Amends the Corporations Act 2001 (Cth) (Corporations Act) to allow the Minister to exempt classes of persons from the operation of specific provisions of the Corporations Act 2001 (Corporations Act) or the Corporations Regulations 2001 (Corporations Regulations), or modify the operation of those provisions in relation to a class of persons, by legislative instrument if the Minister is satisfied that: It would not be reasonable to expect the persons in the class to comply with the provisions because of the impact of the coronavirus known as COVID-19; or The exemption or modification is otherwise necessary or appropriate in order to: facilitate continuation of business in circumstances relating to the coronavirus known as COVID-19; or mitigate the economic impact of the coronavirus known as COVID-19. A legislative instrument made under these provisions has a maximum period of effect of six months. The Minister will have these powers for a period of six months after the legislation comes into force.
Schedule 9 – Child care	Amends the A New Tax System (Family Assistance) Act 1999 and A New Tax System (Family Assistance) (Administration) Act 1999 to provide limited flexibility to manage the impact of the coronavirus, as well as future disasters, on families and on business continuity for child care services.
Schedule 10 – Superannuation drawdowns	Amends the Superannuation Industry (Supervision) Regulations 1994 (SIS Regulations) and Retirement Savings Accounts Regulations 1997 (RSA Regulations) to give effect to the Government's announced measure to reduce the minimum payment amounts for account-based pensions (and for the equivalent annuity products) by half for the 2019 to 2020 and 2020 to 2021 financial years.
Schedule 11 – Additional support for income support recipients	Amends the Social Security Act 1991 to allow Australians to claim jobseeker payment or Youth Allowance (other) if they are an Australian resident (or exempt from the residence requirements) and satisfy the requirements outlined in a legislative instrument. Qualifying persons (including existing and new recipients of the eligible payment categories) will receive the current rate of jobseeker payment or Youth Allowance (other) along with a fortnightly supplement of $550 or such other amount determined by legislative instrument. The supplement is available for an initial six-month period, commencing on 27 April 2020. The Minister for Families and Social Services may extend the six-month period and extend the supplement to other social security payments. Also amends the Farm Household Support Act 2014 to apply the supplement and exemptions to recipients of the Farm Household Allowance.
Schedule 12 – Temporary relief for financially distressed individuals and businesses	Amends certain provisions of the Bankruptcy Act 1966, the Bankruptcy Regulations 1996, the Corporations Act and the Corporations Regulations to provide temporary relief for financially distressed individuals and businesses.
Schedule 13 – Early release of superannuation	Amends the SIS Regulations and RSA Regulations to allow individuals affected by coronavirus to have up to $10,000 released from their superannuation or retirement savings account on compassionate grounds up to twice, one for an application made during the 2019 to 2020 financial year and another for the 2020 to 2021 financial year.
Schedule 14 – Medicare levy and Medicare levy surcharge low-income thresholds	Amends the Medicare Levy Act 1986 and the A New Tax System (Medicare Levy Surcharge — Fringe Benefits) Act 1999 to increase: The Medicare levy low-income thresholds for individuals and families (along with the dependent child/student component of the family threshold) in line with movements in the CPI; The Medicare levy low-income thresholds for individuals and families eligible for the Seniors and Pensioners Tax Offset (along with the dependent child/student component of the family threshold), in line with movements in the CPI; and The Medicare levy surcharge low-income threshold in line with movements in the CPI.
Schedule 15 – Delaying the next intergenerational report to 2021	Amends the Charter of Budget Honesty to delay the next intergenerational report from 2020 to mid-2021 to ensure there is adequate time to produce long-term projections that are based on robust budget estimates.
Schedule 16 – Deferral of sunsetting	Allows the relevant Minister for an act or legislative instrument that is scheduled to sunset on or before 15 October 2020 to determine a new day on which the legislation sunsets, which must be no longer than six months after the original sunset date.
Guarantee of Lending to Small and Medium Enterprises (Coronavirus Economic Response Package) Act 2020 (SME Lending Guarantee Act)	Provides that the Minister may, on behalf of the Commonwealth, grant guarantees to financial institutions in connection with loans made, or to be made, to small and medium enterprises if granting the guarantee is likely to assist in dealing with the economic impacts of the coronavirus.
Australian Business Growth Fund (Coronavirus Economic Response Package) Act 2020	Gives effect to the Government's commitment to increase the availability of patient capital for SMEs by authorising the contribution of $100 million to invest in an Australian Business Growth Fund.
Assistance for Severely Affected Regions (Special Appropriation) (Coronavirus Economic Response Package) Act 2020	Gives effect to the Government's commitment to set aside $1 billion to support regions, communities and industry sectors most severely affected by the coronavirus.
Structured Finance Support (Coronavirus Economic Response Package) Act 2020	Establishes the Structured Finance Support (Coronavirus Economic Response) Fund, initially consisting of $15 billion, to: Enable the Government to ensure continued access to funding markets impacted by the economic effects of the coronavirus; and Mitigate impacts on competition in consumer and business lending markets resulting from the coronavirus.
Appropriation (Coronavirus Economic Response Package) Act (No 1) 2019-2020	Effects appropriations from the Consolidated Revenue Fund (CRF) for the ordinary annual services of the Government in addition to amounts appropriated through the Appropriation Act (No 1) 2019-2020 and the Supply Act (No 1) 2019-2020.
Appropriation (Coronavirus Economic Response Package) Act (No 2) 2019-2020	Effects appropriations from the CRF for services that are not the ordinary annual services of the Government in addition to amounts appropriated through the Appropriation Act (No 2) 2019-2020 and the Supply Act (No 2) 2019-2020.
Boosting Cash Flow for Employers (Coronavirus Economic Response Package) Act 2020 (Cash Flow Boost Act)	Provides for the Commissioner of Taxation to make cash flow boost payments to eligible entities comprising the first cash flow boost and the second cash flow boost payments. The first cash flow boost payments are required to be made by the Commissioner to eligible entities for periods from March 2020 to June 2020. Entities are eligible to receive the first cash flow boost for a period if: The entity makes a payment that is subject to withholding obligations under Subdivisions 12-B, 12-C or 12-D (broadly, a payment of wages or salary or similar remuneration), whether or not any amount is actually withheld, in the period; Either: the entity was a small or medium business entity, or a charity or other not-for-profit entity of equivalent size, for the most recent income year of the entity for which an assessment of income tax has been made by the Commissioner; or the Commissioner is reasonably satisfied that it is likely that the entity is a small or medium business entity, or a charity or other not-for-profit entity of equivalent size, for the income year that includes the period; The entity has notified the Commissioner of their entitlement in the approved form; The period is one of the following: the quarters ending in March 2020 or June 2020; and the months of March 2020, April 2020, May 2020 or June 2020. If the entity is not an Australian Charities and Not-for-profits Commission registered charity, it both: held an ABN on 12 March 2020; and either derived assessable income from carrying on a business in the 2018 to 2019 income year or made one or more supplies for consideration in the course of an enterprise it carried on within Australia in tax periods commencing after 1 July 2018 and ending before 12 March 2020 and notice of the income or supplies was held by the Commissioner on or before 12 March 2020 or within such further time as the Commissioner allows; and The entity (or an associate or agent of an entity) has not engaged in a scheme for the sole or dominant purpose of seeking to make the entity entitled to the first cash flow boost or increase the entitlement of the entity to the first cash flow boost. The Cash Flow Boost Act also provides for the Commissioner to make the second cash flow boost payments upon lodgement of activity statements for periods from June to September 2020 to entities that were entitled to the first cash flow boost.
Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020	This Act will amend a range of legislation cited in a series of schedules.
Schedule 1 - Amendment to the Fair Work Act 2009 (Cth) (FWA)	Amends the FWA to support the practical operation of the JobKeeper Scheme in Australian workplaces in the national workplace relations system. Schedule 1 inserts new Part 6-4C into the FWA, which: Temporarily enables employers to issue JobKeeper enabling directions. Requires JobKeeper Scheme qualifying employers to meet minimum payment obligations to employees who are subject to these arrangements. Includes rules about accrual of service and calculation of benefits in certain circumstances. (See JobKeeper Scheme.) Practical Law Employment is in the process of updating resource to account for the changes made to the FWA as a result of this legislation.
Schedule 2 - Coronavirus Economic Response Package (Payments and Benefits) Act 2020 (Cth) and consequential amendments	Amends various legislation to enable payments under the Coronavirus Economic Response Package (Payments and Benefits) Act 2020, which establishes a framework to administer the JobKeeper Payment. Under the framework, the Treasurer will be able to make rules to provide for payments administered by the Commissioner. Schedule 2 also: Makes technical amendments to the Income Tax Assessment Act 1936 (Cth), Income Tax Assessment Act 1997 (Cth), the Social Security Act 1991 (Cth) and the Veterans' Entitlement Act 1986 (Cth) to ensure a consistent treatment of the JobKeeper Payments. Makes amendments of a machinery nature to the Cash Flow Boost Act. Provides a power in the Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020 (Cth) for the Minister for Families and Social Services to determine modifications to Part 5 of the Social Security (Administration) Act 1999 (Cth). The modifications to the SSAA must be in connection with payments under the Coronavirus Economic Response Package (Payments and Benefits) Act 2020, including applications for such payments. Makes amendments to the Paid Parental Leave Act 2010 (Cth) to address relevant changes to paid parental leave as a result of the JobKeeper Payments. Amendments to provide that a person in receipt of the JobKeeper Payment will be considered to be performing qualifying work for the purpose of the paid parental leave work test. This will mean that the period the person receives the JobKeeper Payment will count toward the paid parental leave work test.
Schedule 3 - Guarantee of lending to small and medium enterprises	Makes technical amendments to the SME Lending Guarantee Act. The amendments ensure that certain categories of smaller non-ADI lenders will fall within the definition of financial institution in that Act.
Schedule 4 – Amendments to support the child care sector	Amends the A New Tax System (Family Assistance) (Administration) Act 1999 (Cth) to: Modify the calculation method used for Child Care Subsidy reconciliation to ensure a consistent outcome for individuals who have changed their relationship status during the financial year. Meet various circumstances of social and financial hardship being experienced by the child care sector and families, arising from emergency and disaster events including the Coronavirus by ensuring that payments of Additional Child Care Subsidy and certain grants can draw upon standing appropriations.
Schedule 5 – Modification of information and other requirements	Provides a temporary mechanism for responsible Ministers to change arrangements for meeting information and documentary requirements under Commonwealth legislation in response to the challenges posed by COVID-19. A determination under this mechanism may apply retrospectively. However, a determination will be beneficial to individuals and business by retrospectively validating approaches to providing information or meeting documentary and witnessing requirements that may otherwise have been invalid.
Schedule 6 – Additional support for veterans	Allows the Veterans' Minister to: Increase, by legislative instrument, the amount paid to persons receiving a payment under a provision of various acts relating to veterans (eVterans' Law) by the amount of the COVID-19 supplement (see Payments to social security, veteran and other income support recipients). Vary the qualifications and eligibility for payments under the Veterans’ Law by legislative instrument.
Schedule 7 – Tax secrecy	Makes amendments to the tax secrecy provisions in the Taxation Administration Act 1953 (Cth) to allow de-identified protected information to be disclosed to the Treasury for the purposes of policy development, or analysis, in relation to COVID-19, including in relation to programs introduced in response to the economic impacts of COVID-19. The amendments allow such disclosures to be made until 30 June 2023.
Coronavirus Economic Response Package (Payments and Benefits) Act 2020 (Cth)	Establishes a framework for the JobKepper Scheme. Under this payment framework, the Commissioner has general administration of the JobKeeper Payment. The framework also sets out: The manner in which payments are made. Rules for overpayments (including the application of interest). The process for the review of decisions about the payments. The applicable record-keeping requirements. Details of eligibility for particular payments as well as the amount of payments and the time when they are to be paid are to be set out in the rules made by the Treasurer. (See JobKeeper Scheme.)
Appropriation Act (No. 5) 2019-2020 (Cth)	Effects appropriations from the CRF for the ordinary annual services of the Government in addition to amounts appropriated through the Supply Act (No. 1) 2019-2020, the Appropriation Act (No. 1) 2019-2020, the Appropriation Act (No. 3) 2019-2020 and the Appropriation (Coronavirus Economic Response Package) Act (No. 1) 2019-2020. Other annual appropriations that are not for the ordinary annual services of the Government are proposed in the Appropriation Act (No. 6) 2019-2020.
Appropriation Act (No. 6) 2019-2020 (Cth)	Effects appropriations from the CRF for services that are not the ordinary annual services of the Government in addition to amounts appropriated through the Supply Act (No. 2) 2019-2020, the Appropriation Act (No. 2) 2019-2020, the Appropriation Act (No. 4) 2019-2020 and the Appropriation (Coronavirus Economic Response Package) Act (No. 2) 2019-2020. Other annual appropriations that are not for the ordinary annual services of the Government are proposed in the Appropriation Act (No. 5) 2019-2020.

Federal government economic response to COVID-19 | Practical Law