WA COVID-19 Pay-roll Tax Relief Legislation Receives Assent

Thursday 7 May 2020 @ 1.19 p.m. | Legal Research | Taxation

On 15 April 2020, the WA Treasurer Ben Wyatt introduced the Pay-roll Tax Relief (COVID-19 Response) Bill 2020 (“the Bill”) to WA’s Legislative Assembly, with the Bill passing the Assembly on the same day.

Due to the urgency of the legislation, the Bill was introduced to, and passed through, the Legislative Council (“Council”) on 16 April 2020, and received assent on 20 April 2020 as the Pay-roll Tax Relief (COVID-19 Response) Act 2020 (No 16 of 2020) (the “Act”). All provisions of this Act have fully commenced.


The Bill’s Explanatory Memorandum (“the EM”) notes that the object of the legislation is to “exempt wages paid between 1 March 2020 and 30 June 2020 for employers or groups with Australian taxable wages less than $7.5 million in 2019-20 and wage subsidies paid by employers to employees under the Australian Government’s JobKeeper payment scheme” from pay-roll tax.

The EM notes that the measures are expected to provide specific relief related to the pandemic, rather than generally applying to pay-roll tax. As the COVID-19 pandemic and response is a rapidly evolving situation, regulation-making powers have been included in the legislation to allow other wages and payments to be exempted from pay-roll tax if further relief is required.

Government Comment on the Bill

Commenting on the Bill in his speech, the Treasurer said:

“… The waiver is expected to deliver approximately $165 million in pay-roll tax relief to around 10 700 businesses that will not have to pay pay-roll tax for the four-month period. Employers, or groups of employers, with Australian taxable wages of less than $5 million over the 2019–20 financial year to 29 February 2020 can automatically claim the waiver by lodging their returns as usual with the WA taxable wages for March to June declared as exempt wages …”

The Hon Diane Evers (Greens) said in her speech:

“… One major point of this bill is that it makes sure that JobKeeper payment scheme money is not part of the assessment for pay-roll tax … The sunset clause will come into effect 12 months after assent. That will be a good amount of time to work through any of the details and make sure that we have applied this legislation correctly. Hopefully, at that time, we will be well and truly out of this situation … the Greens will support this bill.”

In a WA Government media release, the Minister commented:

“We know that receiving payments faster will improve cash flow and help small to medium WA businesses pay their staff, suppliers and other bills. Improving cash flow for businesses will help them recover from the COVID-19 pandemic and support the recovery of the Western Australian economy …”

The media release also notes that the Department of Finance will:

  • fast-track payments to suppliers for invoices of under $1 million as part of a new initiative that will provide additional support for Western Australian businesses during and after the COVID-19 pandemic;
  • pay invoices of under $1 million to businesses within 20 days, rather than the current 30-day term; and
  • start to implement the faster payment terms from 1 May 2020 for goods and services and from 18 May 2020 for works.

Businesses to benefit from fast-tracked payment terms will include construction companies, maintenance contractors, building landlords and community services organisations.

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