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Victorian business support hits $3.4bn amid shrinking economy

Adrian Flores
Adrian Flores
23 July 2020 1 minute readShare
Melbourne business

The Victorian government has announced it has provided $3.4 billion in support to businesses and households as it forecasts its economy to contract by 5.25 per cent this calendar year.

Modelling released by the Victorian Department of Treasury and Finance also showed taxation and GST revenue expected to be around $8.5 billion lower over the 2019–20 and 2020–21 financial years compared with pre-pandemic forecasts as a result of lower property tax revenue, declining payroll tax and reduced GST.

The modelling is based on existing conditions in Victoria and the current six-week lockdown and is an update on modelling released in April.

The Victorian government also said it has provided $504 million in payroll tax refunds to nearly 19,000 businesses, while 77,139 businesses have been approved for support grants totalling $771.3 million.

In addition, more than 23,000 businesses have had liquor licences and application fees refunded totalling $22.61 million.

Victorian unemployment climbed to 7.5 per cent in June, and is forecast to peak at 9 per cent in the September quarter.

The Victorian budget is also predicted to return an operating deficit of $7.5 billion in 2019–20.

The Victorian government said it has spent more than $9 billion so far in dealing with the public health and economic effects of the COVID-19 pandemic.

“The global coronavirus recession is one of the biggest economic challenges our state and country has ever faced — and we are not immune from its impacts,” Victorian Treasurer Tim Pallas said.

“We’re doing everything we can to support the tens of thousands of businesses, workers and families doing it tough.

“Victoria’s economy is robust and will make it through to the other side, but we all need to follow the rules and slow the spread — the sooner we can get on top of this virus, the sooner we can repair the economic damage it’s caused.”

Victorian business support hits $3.4bn amid shrinking economy
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Adrian Flores
Adrian Flores

Adrian Flores is the deputy editor of MyBusiness. Before that, he was the deputy editor for SMSF Adviser as well as features editor for ifa (Independent Financial Adviser), InvestorDaily, Risk Adviser, Fintech Business and Adviser Innovation.

You can email Adrian at [email protected].

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