NSW Budget Summary
This week the Treasurer announced the NSW State Budget.
Below is an analysis composed by Business NSW of some of the most critical points for you to know.
Please be advised this is just a summary and there is a lot more information in the full budget announcement. If you need to know more please contact us, so we can go through any points you may need to discuss.
The NSW Treasurer has delivered a budget designed to support the next phase of our recovery.
Highlights for Business
Payroll Tax Thresholds and Cuts:
The payroll tax threshold will be increased to $1.2 million with the rate of payroll tax lowered from 5.45 to 4.85 per cent for the next two years. The threshold increase alone will deliver an annual saving of $10,900 (for businesses above the new threshold), with further savings over the next two years due to the lower rate. Recent Business NSW advocacy has resulted in a $450,000 increase to the threshold, saving the typical business close to $25,000 and exempting thousands of businesses from payroll tax.
Dining and Entertainment Vouchers:
$500 million will be allocated to deliver four $25 vouchers to every NSW adult to spend at entertainment and hospitality venues. This measure will provide a much-needed temporary boost to customer demand in some key parts of the economy that are struggling.
Fee relief for SMEs:
SMEs that do not pay payroll tax will receive a $1,500 digital voucher to use against the cost of NSW Government fees and charges.
The NSW Budget provides relief for areas of the economy hardest hit by COVID-19 such as tourism, hospitality and the arts. This includes $15 million to revitalise the Sydney CBD and $175 million in funding for investment in new film and television projects. Funding for business advice will be expanded with $39 million in funding for Business Connect.
The NSW infrastructure pipeline has expanded to $107.1 billion which is expected to generate 145,000 jobs. While the Budget does not announce any significant new projects, the Government has focussed on fast-tracking targeted investments in shovel ready-projects to boost demand in the near term.
In addition to existing drought and bushfire relief, regional NSW will benefit from $8.7 billion in regional road and transport infrastructure spending. The Regional Growth Fund which provides funding for community upgrades and projects has been expanded by $300 million. More than 90 new and accelerated regional projects totalling $1.8 billion have been supported by the Jobs and Infrastructure Acceleration Fund.
Skills and Education:
Women will be supported by $5,000 grants for training and support to return to the workforce while $17 million will be spent for upskilling, mentoring and job matching for people working in the care economy.
Property Tax Reform:
In a significant advocacy result, the Treasurer announced a proposal for property tax reform with a plan to replace stamp duty with an annual tax on land value. Under the proposal, homebuyers would be able to choose whether to pay stamp duty or the new land tax. It is estimated the proposal would boost the NSW economy by 1.7 per cent. The Government is seeking stakeholder feedback on the proposal.
Skills and Education:
The Government will develop a new model to support the entry of mid-career professionals into teaching. Building on recent recommendations made in the Productivity Green paper, the Budget also announced skills reforms to introduce new pathways into trades, particularly for mature workers and women.
Another great reference is the Sydney Morning Heralds “winners and Losers” article regarding the NSW Budget. You can read this article here: https://www.smh.com.au/politics/nsw/winners-and-losers-in-the-2020-nsw-budget-20201116-p56f50.html