Federal Budget 2020: Employers to get up to $200 per new young employee with JobMaker, can write off full cost of purchased assets with JobTrainer

Businesses hiring people aged 16 to 35 will be able to claim up to $200 a week under the Federal Government’s JobMaker program announced in tonight’s budget.

Employers – except for the major banks – who create a new position and fill it with an eligible young employee will be able to claim a hiring credit.

The $4 billion program will come into effect for employers from tonight and will apply to every eligible employee they hire in the next 12 months.

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In that time, any worker aged 16 to 29 will net their boss a $200 weekly credit, and those aged 30 to 35 will merit a $100 credit.

For a worker to be eligible, they will have had to have received JobSeeker, youth allowance, or parenting payments for at least one of the three months prior to their hiring.

They will have to work for at least 20 hours a week for their new employer.

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The government estimated JobMaker would support about 450,000 new jobs for younger people, who are among the groups hit particularly hard by the shrunken economy.

“Having a job means more than earning an income,” Treasurer Josh Frydenberg said.

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“It means economic security. It means independence. It means opportunity.”

Business owners will benefit from another government plan to expand the instant asset write-off policy introduced during the COVID-19 crisis.

From tonight, more than 99 per cent of businesses will be able to write off the full value of any eligible asset they purchase for their business.

“A trucking company will be able to upgrade its fleet, a farmer will be able to purchase a new harvester and a food manufacturing business will be able to expand its production line,” Mr Frydenberg said.

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“Small businesses will buy, sell, deliver, install, and service these purchases. Every sector of our economy, every corner of our country, will benefit.”

The scheme will be available for small, medium and larger businesses with a turnover of up to $5 billion, until June 30, 2022.

Mr Frydenberg said it was a “game changer”.

The government estimates the temporary expensing would deliver $26.7 billion in tax relief over the forward estimates, and $3.2 billion in the medium term.

Training for tomorrow

A billion-dollar JobTrainer fund will support up to 340,700 additional free or low-fee training places “in areas of genuine need”.

The fund will be targeted not just at school leavers, but also workers in need of retraining or upskilling.

A $1.2 billion apprentices wage subsidy program will see the government pay 50 per cent of an apprentice’s income – up to a cap of $28,000 a year.

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The government claimed the subsidy would help create 100,000 new apprenticeship positions.

Mr Frydenberg claimed the budget laid out a “record investment” in upskilling and reskilling workers.

Tax relief for business

Special measures have also been announced for Australian businesses who went from profitable to loss-making under the impact of COVID-19.

Companies with a turnover of up to $5 billion will be able to offset losses against previous profits on which tax has been paid, to generate a refund.

Losses incurred up to 2021-22 can be carried back against profits made in or after 2018‑19.

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Eligible companies may elect to receive a tax refund when they lodge their 2020-21 and 2021‑22 tax returns.

“The combination of the immediate expensing and loss carry-back measures will create an additional 50,000 jobs across the country,” Mr Frydenberg said.

The government estimated the measure would deliver $4.9 billion in tax relief to businesses over the forward estimates, and $3.9 billion over the medium term.

Graphics: Tara Blancato