The Australian Federation of Travel Agents (AFTA) has welcomed the $17.6 billion Coronavirus (COVID-19) support package released by the Federal Government yesterday, Thursday 12th March 2020.
In a media alert, AFTA said the stimulus package is “critical to Australians, the travel industry and the broader business community and economy at a time of such immense uncertainty”.
“COVID-19 has brought many challenges to the travel industry and as it seems the worst is right before us. AFTA is acutely aware of just how bad the current trading conditions are and we want to assure members and the broader travel industry that we remain confident that an end is in sight,” the organisation said in a memo to travel advisors.
The memo continued: “The industry will recover from this, but we know many travel businesses are suffering great hardship at this time. AFTA continues to work behind the scenes daily with government at both federal and state levels to ensure that the TRAVEL industry is not forgotten.
“The federal stimulus package we believe will provide some relief to cash flow, but more may be needed and we will monitor the situation very closely over the coming weeks and months.”
Next week, AFTA will be releasing a ‘how to’ guide, entitled Travel Business: How to access the Stimulus Package to support members and the broader industry to understand the steps to access support where eligible for your business.
“AFTA is pleased the Federal Government is making a solid commitment to sustaining the Australian economy in the wake of the COVID-19 outbreak, ”AFTA Chief Executive Jayson Westbury said.
“Small business lives and dies on cashflow, and this is particularly acute in travel agencies at this time with low to no bookings, and refunds flowing out the door. AFTA will drive the guidance process to help support agencies across the country to understand how they can access the funds being made available and if this is not enough, will stand ready to take it up with the Prime Minister directly,” Westbury added.
Specific measures that are in place that may help assist AFTA members include:
- Increasing the instant asset write-off threshold from $30,000 to $150,000, effective immediately until 30 June 2020. This will also be expanded to include businesses with aggregated annual turnover of less than $500 million (up from $50 million). Travel business suggestions and a guide to be released next week.
- Boosting cash-flow for employers by providing up to $25,000 back to small and medium-sized businesses, with a minimum payment of $2,000 for eligible businesses. This payment will be tax free. This is a GRANT, you will not have to pay it back. Travel business examples and a guide will be released next week.
- Supporting small business to retain their apprentices and trainees, by applying for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage for up to 9 months from 1 January 2020 to 30 September 2020.
- Where a small business is not able to retain a trainee, the subsidy will be available to a new employer that employs a trainee.
The government grants will be issued automatically, based on business activity statements or instalment activity statements from 28 April 2020.
AFTA also encourages all ATAS accredited travel agency businesses to get in touch with the Australian Taxation Office (ATO) who can tailor a support plan for your businesses needs and circumstances around the relief options.
Options available to assist travel agency businesses impacted by COVID-19 include:
- Deferring by up to four months the payment date of amounts due through the business activity statement (including PAYG instalments), income tax assessments, and fringe benefits tax assessments.
- Allowing businesses on a quarterly reporting cycle to opt into monthly GST reporting in order to get quicker access to GST refunds entitlements.
- Allowing businesses to vary Pay As You Go (PAYG) instalment amounts to zero for the April 2020 quarter. Businesses that do vary their PAYG instalment to zero can also claim a refund for any instalments made for the September 2019 and December 2019 quarters.
- Remitting any interest and penalties, incurred on or after 23 January 2020 that have been applied to tax liabilities.
- Working with affected businesses to help them pay their existing and ongoing tax liabilities by allowing them to enter into low interest payment plans.
AFTA continued, saying it is “committed to working with members to protect the health, the wellbeing, and the livelihoods of Australian travel agents through this global crisis, and to ensure that when the recovery comes – and it will – our industry is well positioned to bounce back strongly on the other side.”
Lead image: Australian Prime Minister Scott Morrison making a public address on Thursday evening.