The Australian Retailers Association (ARA) has welcomed the business support and consumer stimulus measures delivered in the 2020-21 Federal Budget and said the investment will provide a crucial turning point for business and consumer confidence as we build towards a recovery.
“There can’t be an economic recovery without a retail recovery,” said ARA CEO Paul Zahra. “The ARA has been calling for measures which encourage consumer spending and provide cash flow relief to business during this financially challenging time.
“We are pleased to see some gains across all of these areas – with highlights being the personal income tax reductions and some modest cash stimulus for welfare recipients which will boost immediate spending power, as well as the loss carry-back scheme and the wage subsidies which will both help keep more money in the bank for struggling retailers in the coming year.
“A positive transformation can come from this crisis for retailers – and training and skills development are crucial to help position retailers and their teams for future success.
“As with every budget, the devil is in the detail. Retail is the largest private sector employer and we look forward to understanding more specifically how the retail industry will be supported through the various skills and training programs to position it to thrive.
“We remain keen to see certainty around the continuation of JobSeeker which will provide significant consumer spending power and confidence,” said Mr Zahra.
“Retail is a predominantly female sector, particularly in the area of frontline jobs – and whilst we applaud the support for women, childcare support remains a hurdle we would like to see addressed,” said Mr Zahra.
ARA – key wins for retail:
Spending-power
Personal income tax reductions backdated to 1 July 2020 – which will help free up consumer spending power
Cash payments of $500 for those on welfare – whilst modest will help stimulate some level of retail spend.
Business boosting
$105 million loss carry-back scheme – providing cash benefits to loss-making companies. This puts more money in the company pocket. As we have seen from the protracted Victorian lockdowns, many retailers have, through no fault of their own, found themselves in a loss-making situation with mounting debts. This measure allows businesses to bolster their cash reserves so they have an opportunity to rebuild in 2021 when trading conditions are more stable.
Expansion of the Instant Asset Write Off – allowing businesses to write off the full value of any eligible asset they purchase for their business will free up cash and help stimulate expansion.
Deregulation of credit policy to stimulate spending – which will help small business to access credit
Boosting jobs
$1.2 billion wage subsidy for 100,000 new apprenticeships and traineeships with a 50 per cent wage subsidy for businesses who employ them – which will mean increased opportunities for young people and women to join the retail workforce and will also add more spending power to our economy
$4 billion JobMaker Hiring Credit: Back to work wage subsidy for young Australians – which will mean more financial security and stability for young people and provide more spending power.
Training and future-proofing
$800 million Digital Business Plan – with training, advice and support for SME’s
$1.5 billion manufacturing investment – which will support growth in key areas including food and beverage
$240 million toward the Women’s Economic Security Statement – these programs will help encourage Job creation and entrepreneurship; and women’s safety at work and at home
FBT Exemption for skills training – which will support businesses to retrain their people with digital and online skills
Protecting business owners
Reform in insolvency provisions – offering much needed protections for business owners
