Support aims to help business drag economy out of the pandemic mire
Heavy Vehicle Industry Australia (HVIA) views the 2020 federal Budget as the right strategy for an economic situation unrivalled in recent memory.
The impact of the pandemic merits a commensurate stimulus package “to ensure the recovery is swift and powerful”, it says, pointing out that the global economic contraction in 2020 is 45 times worse than the 2009 Global Financial Crisis (GFC).
“That is why much of the stimulus is front-loaded, proportionate and temporary,” HVIA CEO Todd Hacking says in a message to his members.
“It is aimed at boosting confidence and returning to economic growth as quickly as possible.
“Unashamedly, treasurer Josh Frydenberg’s strategy is about job creation.
“The quickest way for Australia to recover economically is to get people off welfare and into a tax-paying job.”
That said, HVIA acknowledges expert economic commentary on assumptions on the macroeconomic indicators and Budget predictions, such as a Covid-19 vaccine next year.
But it believes broad industry pressure for stimulus measures, including the Backing Business Investment incentive and the Instant Asset Write-off, have worked in its favour through the pandemic so far.
Read how other industry associations responded to the2020 Budget, here
“We fought hard to have the latter extended until the New Year, and its effectiveness has been recognised in this budget, now being extended even further with the new Temporary Full Expensing initiative (available to 99 per cent of businesses with a turnover up to $5bn), extended (any asset value) and pushed out until 30 June 2022,” Hacking states.
“This is an amazing boost for our industry!”
It is noted assistant minister Scott Buchholz acknowledges the critical role of the heavy vehicle industry, saying: “The government is fully behind the industry which has been essential throughout the pandemic.”
“The 50 per cent wage subsidy for apprentices and trainees is another solid commitment that will incentivise HVIA members to get young people into a career in the heavy vehicle industry,” Hacking says.
“There is also the Hiring Credit (up to $200 a week) for business, to support them to hire people aged 16-35, currently receiving JobSeeker and get them back into the workforce.
“Tax cuts have been targeted at middle income earners and more than 11 million employees will have this back dated to 1 July 2020.
“The tax treatment of businesses is to be amended by allowing businesses who have losses (to 2022) offset these against profits made in 2018-19.
“The $100 billion infrastructure pipeline over the next decade has been further increased with a further $14 billion in new money, much of which is targeted at shovel ready projects that indirectly support our industry.
“Business is the engine-room of the economy and there is much in this budget for business.
“Australians are resilient, our economy was in good shape, our capacity to invest to this magnitude is better than most other OECD countries and the debt and deficit levels, whilst eye-watering is manageable in the short term.”
Despite the value it sees in the Budget measures, HVIA warns members they are yet to be set in stone.
“It is also worth making sure you have received advice from your advisers before acting on any of the announcements – noting the budget is not officially passed yet and can be amended in the Senate,” it says.