8 October 2020
One of the key announcements to come out of the Federal Budget handed down on 6 October 2020, was the Government’s intention to create an internationally competitive and resilient manufacturing sector as part of its job creation and COVID-19 recovery strategies.
In addition to the $2 billion R&D tax incentives announced, the Federal Budget 2020/21 proposed further support to build Australia’s capabilities in key priority sectors.
The Government announced it will be providing:
- $1.5 billion over four years as part of its Modern Manufacturing strategy.
- $1 billion for new research funding for universities.
- $1.9 billion in new funding to support low emissions and renewable technologies.
- $317 million for regional Australian exporters to continue to access global supply chains.
Modern Manufacturing Strategy
The Government proposes a $1.5 billion investment over four years in the Modern Manufacturing Strategy to support projects in six national manufacturing priorities including:
- Resources technology and critical minerals processing.
- Food and beverage.
- Medical products.
- Recycling and clean energy.
The Government will provide an additional $1.0 billion in 2020-21 through the Research Support Program, supporting:
- Investments in nationally significant research infrastructure.
- Securing research jobs.
- Strengthening partnerships between universities and industry ensuring continued delivery of world class research.
Investment in New Energy Technologies
The Government will provide $1.9 billion over twelve years from 2020-21 (including $628.5 million over four years to 2023-24) to continue funding the Australian Renewable Energy Agency (ARENA).
This investment will enable expansion of the investment mandate of the Clean Energy Finance Corporation (CEFC) to invest in low emissions technologies, network infrastructure, dispatchable generation and reliable supplies in the National Electricity Market (NEM).
Regional Export support
The Government will provide $328.4 million over four years from 2020-21 for a package of measures to improve the ease of doing business for agricultural exporters. This is in addition to the implementation of simplification measures and additional funding which were made available in 2020 and previously announced for the Export Market Development Grants Scheme to more effectively support export-ready small and medium enterprises.
For more information on any of the tax incentive announced in Federal Budget 2020/21, talk to your adviser or contact the Findex Tax Advisory team.
For more Federal Budget coverage and news as it comes to hand, visit our Federal Budget Resource Centre.