The winners and losers of the NSW 2020 budget

While the public service will be a big target of the NSW government’s pandemic-induced savings measures, NSW residents will get $100 worth of vouchers to spend on hospitality and entertainment.

WINNERS

Restaurants

Households will get up to $100 in vouchers to spend at cafes, restaurants and pubs across the state to help the hospitality industry as part of a $500 million “Out and About” stimulus measure. The vouchers will not be able to be used on cigarettes or alcohol. Each voucher will be worth $25 and cannot be combined or saved, if the total bill doesn’t reach $25 then the remainder stays unspent.

First home buyers

Treasurer Dominic Perrottet has proposed a shift away from stamp duty to an annual property tax based on land values. Buyers will be given the choice between the two, with the property tax option locking in all future owners of the site to the annual levy.

Businesses looking for a sea change

As part of its “unashamed” grab for business, the NSW government is slashing payroll taxes for four years to businesses that create at least 30 new jobs in NSW by June 2022. The $250 million Jobs Plus program will also offer up free office space, subsidised training programs and fast-tracked planning approvals.

Parents

The government is extending free community preschool for three to five-year-olds, at a cost of $120 million.

Hospitals and the health system

Nearly $3 billion is earmarked to build new or upgrade existing hospitals. Tens of millions of dollars are also being splashed on mental health initiatives, palliative care and crisis support services.

Small businesses

The payroll tax threshold will increase from $1 million to $1.2 million, while a $5 million program will help small businesses deal with the hurdles to apply for tenders.

The government estimates an extra 8500 businesses will now be exempt from paying payroll tax with some to receive $1500 vouchers to help cover the costs of government fees and charges.

Businesses in general 

Payroll tax for all businesses in NSW in 2020-21 and the next financial year will be slashed from 5.45 per cent to 4.85 per cent, which the government says makes it the lowest rate in any metropolitan area in Australia.

Social housing 

The NSW government will spend more than $812 million on building or upgrading social housing to help create jobs while meeting demand for affordable housing. It comes as the Victorian government looks to spend $5.3 billion on social housing.

Infrastructure 

The government is investing in $107.1 billion in infrastructure, including fast-tracking major projects to smaller scale initiatives like replacing lights across the state’s schools with LED lights.

LOSERS

Public service 

NSW mandarins will be one of the biggest targets of the Treasurer’s savings measures, with a four-year freeze on public service pay and focus on cutting “wasteful” spending, like travel, events and contractors.

Other states 

NSW is making a big pitch to businesses outside its borders, mainly with competitive tax rates or charges, including a new payroll tax threshold double that of Victoria’s.

The story first appeared via https://www.afr.com/politics/nsw-budget-2020-winners-and-losers-20201113-p56edg

By Finbar O’Mallon

November 17th, 2020