18/11/2021 - 13:00

Low uptake of COVID land tax relief

18/11/2021 - 13:00

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Almost all funding allocated to tax relief for commercial landlords as part of recent COVID-19 relief measures was either spent as industry support or returned to consolidated revenue, state parliament has heard.

Low uptake of COVID land tax relief
Stephen Dawson said the program's low uptake reflected WA's management of COVID-19. Photo: Gabriel Oliveira

Almost all funding allocated to tax relief for commercial landlords as part of recent COVID-19 relief measures was either spent as industry support or returned to consolidated revenue, state parliament has heard.

That follows publication of findings from the Office of the Auditor General in October that found 39 per cent of stimulus funding and financial relief allocated to COVID-19 relief between June 2020 and March of this year was not used.

The report noted a far greater percentage of financial relief initiatives had been accessed due to the ease of which they could be rolled out, with project-specific initiatives lagging due to the difficulties associated with contracting and procurement processes.

Just $2.49 million of the $100 million allocated to land tax relief grants for commercial landlords providing rental assistance to tenants was spent, with the auditor general’s report noting the amount on offer and difficulty in determining eligibility criteria as reasons for the undersubscription.

Landlords who provided rent relief from March 2020 onwards were eligible for grants, which were worth the equivalent of 25 per cent of their land tax bill in the 2020 financial year.

To qualify for the grants, landlords had to demonstrate their tenants had experienced a 30 per cent drop in turnover with their property either valued at $300,000 or more, or subject to land tax.

Landlords were also required not to recover waived rent or increase outgoing charges for a period of six months.

Addressing questions from shadow treasurer Steve Thomas on Tuesday, Mental Health Minister Stephen Dawson said $75 million of funding was diverted to the state government’s $9 billion industry support fund, with the remaining balance returned to consolidated revenue.

He said 640 landlords had applied for the grants over both rounds of the program, with 502 of those applicants successful.

Of the remaining applications, 101 were not approved and 37 were withdrawn.

“The low uptake of the program is a result of the state government’s proactive management of the COVID-19 pandemic, and the strong recovery Western Australia has been able to secure,” Mr Dawson said.

“As a result, Western Australia has had some of the best conditions for small businesses in the country allowing many to return to normal conditions quickly.”

A spokesperson for the state government previously told Business News there had never been an expectation that all funding allocated to COVID-19 relief measures would be spent by March.

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