Business Support Grant Program

The Hon. D.G.E. HOOD (14:48): My question is to the Treasurer. Can the Treasurer advise the chamber whether the latest round of business support grants will be assessable for taxation purposes?

The Hon. R.I. LUCAS (Treasurer) (14:48): I am pleased to be able to report to the house that only this week I have received correspondence from the federal Treasurer, Mr Frydenberg, in response to an earlier letter from me to the federal Treasurer dated 3 September. That letter sought, on behalf of South Australian recipients of the business support grants recently announced, as to whether or not they would be eligible to be treated as non-assessable, non-exempt grants for income tax purposes.

As members will be aware, the earlier rounds of similar grants last year and earlier this year, the commonwealth government hadn't agreed that they would be non-assessable, non-exempt income for income tax purposes but I am pleased to say that I think there have been some recent legislative changes from the commonwealth government which are to be welcomed.

The federal Treasurer has now agreed that the most recent grants that have been provided to businesses, which range from $1,000 to $3,000 to $6,000 and then also $10,000 and $20,000 grants, depending on eligibility, will, for the first time in terms of these grant programs in South Australia, be non-assessable, non-exempt for income tax purposes, which is a good result for those small business recipients who receive them.

I do note that certainly in New South Wales and Victoria, there has been a similar treatment in relation to similar grant programs in their jurisdiction and it may well be the case in the other states and territories as well. We are not indicating that South Australia is being treated any differently here. We are pleased to say that, with the new arrangements from the commonwealth, grant programs like this in states and territories that are eligible for this new tax treatment will be treated in that particular way. There are certain requirements that we have to go through. Just briefly:

The formal process for declaring these grants is underway and Commonwealth Treasury officials will be in contact with officials from your Department when a formal instrument of declaration has been registered on the Federal Register of Legislation.

That process is underway and we welcome the decision of the federal Treasurer in this respect.