Commercial tenants across the Central Coast significantly impacted by COVID-19 will have greater protection from evictions with the State Government set to enact the National Cabinet Code of Conduct as part of a $440M land tax relief package.
Parliamentary Secretary for the Central Coast, Adam Crouch, said the measures would apply to commercial leases where the tenant is in financial distress due to COVID-19, including but not limited to local shops, cafes, gyms, hairdressers, restaurants, offices, warehouses and industrial sites.
The land tax relief will be divided about 50-50, with around $220M going to the residential sector and a further $220M to the commercial sector.
Commercial landlords will be offered the land tax concession if they pass the savings on to tenants through a rent reduction.
Eligible landlords will be able to apply for a land tax concession of up to 25 percent of their 2020 (calendar year) land tax liability on relevant properties.
A further land tax deferral for any outstanding amounts for a three-month period will also be offered to landlords who claim the land tax concession.
The Government will give effect to the Code of Conduct, which will operate for a temporary period during the pandemic, and include the following key measures: landlords must negotiate rent relief agreements with tenants in financial distress due to COVID-19 by applying the leasing principles in the Code; a ban on the termination of a lease for non-payment of rent; and, a freeze in rent increases.
“For any small business, rent is one of the biggest fixed costs, so easing this burden will help operators survive and keep people employed and that is what this new package is all about,” Crouch said.
The policy will apply to business tenants with a turnover of less than $50M that experience a 30 percent (or more) reduction in revenue as a result of the COVID-19 pandemic, in line with the Prime Minister’s announcement on April 7.
This will include any business with annual turnover of less than $50M who is eligible for the Commonwealth’s Job Keeper program.
Treasurer, Dominic Perrottet, welcomed the initiatives, saying: “This provides a way forward for tenants and landlords so they can reach an agreement during this difficult period and includes an incentive in the form of a land tax reduction”.
Finance and Small Business Minister, Damien Tudehope, said the package demonstrated the need for a united effort to endure the COVID-19 pandemic.
“Breathing room on rent is one of the most frequently raised issues by businesses, and we want to ensure that we protect retailers and offer landlords an incentive to do so.
“We also want to ensure that retail tenants have more time and options,” he said.
Source:
Media release, Apr 14
Parliamentary Secretary Central Coast, Adam Crouch