The Australian Taxation Office (ATO) will provide temporary relief for small businesses unable to meet their tax obligations, as the federal government extends a key lending exemption to help small-to-medium enterprises access credit easier.
The measures sought to give people “more flexibility”, Treasurer Jim Chalmers told reporters on Wednesday, following intensified financial pressures on small businesses arising from the war in the Middle East.
ATO relief could include “more generous payment plans, remission of interest and penalties, and also support in various PAYG instalments where there’s been a downturn in taxable income”, Mr Chalmers said.
“They’ll also limit compliance actions across the worst-affected industries, and some debt collection actions may be paused where that’s appropriate,” he said.
“Obviously, we still want people to lodge. Obviously, there is a threshold for where this kind of concessional treatment will be provided, but the ATO is prepared to provide that kind of support in circumstances which are obviously because of what we’re seeing in the Middle East.”
The government will also extend the small business responsible lending obligations exemption for a further 10 years.
“This will help ensure small businesses aren’t slugged with additional regulatory burden and delays when they’re accessing loans,” Mr Chalmers said.
The measures had been taken in consultation with small businesses and peak bodies, Small Business Minister Anne Aly said, speaking alongside Mr Chalmers.
“We can’t control the war in the Middle East. We can’t stop the war in the Middle East, but what a responsible government can do is to do everything that it can to shield its citizens and to shield small businesses,” she said.
Australian banks and non-bank lenders have also put in place specialist teams to support those struggling with cost pressures and supply chain disruptions as a result of the conflict in the Middle East.
Several options are available to customers doing it tough, including temporary payment deferrals, loan restructuring and emergency credit limit increases, depending on individual circumstances.
“And the message we have, and the communications piece, we are putting out there is very much one of urging Australians to reach out as quickly as possible if they are in distress,” Australian Banking Association chief executive Simon Birmingham said at the press conference.
“If you are facing financial pressures right now, get in touch with your bank. Talk to those specialist teams and talk through the options that are available in each of your circumstances.
“For some small businesses, that will be working capital assistance. For others, it will be looking at extending lengths of loans or refinancing arrangements.
“There are a range of targeted, practical steps that can be taken, and we will be launching a communications campaign across Australia sending that clear message to Australians; don’t tough it out on your own.”
