For any business to thrive, it needs the support of the government. The government policies play an active role to help the economy, and export is one of the big contributing factors for boosting the economy.
A statistic on the exports has shown that the current export valuation of goods and services stands at $ 33,737 million. So, if you want to know about the practices of the Australian government to boost exports, you are reading the right article!
What is EMDG?
EMDG, or as it rightly called Export Market Development Grant is an initiative taken up by the Australian government to encourage the export of goods and services by businesses. For any economy, export plays an important role as it leads to the procurement of foreign exchange reserves, which are primarily utilized by the government to work on trade and imports.
This is not a rebate, but a grant, which most of the businesses are eligible for in order to develop their products for the export market, and also focus on the expenses associated with it.
What is the method of operation for EMDG?
When it comes to the grant to be received, it is directly proportional to the amount of money you spend on the marketing of goods and services of exports in the overseas markets.
However, your business must be eligible for it. It is a non-competitive program, and the businesses can avail the grant on the basis of the documents you have to prove the eligibility. To understand the quantum of EMDG funds available, it was seen that close to $157.9 million is provided by the government each year.
And, if the business is completely compliant with all the rules and regulations, a cash rebate of 50% of the overseas marketing spend is usually received. However, there is a ceiling limit of the grant, which stands at $ 150,000 and it is subject to change depending on the available funds. Since it’s a complex process, it is always better to seek guidance from a consultant like Rimon’s EMDG who will help you every step of the process.
Is your business eligible for this grant?
Now that you are clear with how the grant works or what the grant is, it is imperative to understand the eligibility of the program. There are certain prerequisite conditions that are required to be fulfilled if you want to know your business is eligible or not. The conditions are mentioned below:
- The business has an intention of export, and the goods and services are catered towards the overseas markets with an underlying marketing expense against the same!
- The business has not received any of the previous 8 EMDG Rebates.
- They have the license for the following goods or services, or they are planning to seek a license in this field:
- Goods and Services that are completely produced or designed in Australia or in the regions under the Australian Government. The production can happen in the overseas territories, too!
- The intellectual property or technical know-how is sourced from the country of Australia.
- There is a provision for most of the services.
- The business is related to the tourism industry of Australia and the expenses are made for the furtherance of the tourism business in Australia!
- The business has to be registered and should have an ABN – Australian Business Number
- According to the current legislature, the annual turnover of the business has to be lower than AU$ 50 million in the previous fiscal year.
- The businesses have to spend a mandatory monetary expenditure of $15000 in the last two fiscal years with respect to the furtherance of business, goods, and services to potential customers in the overseas markets.
If these conditions are fulfilled, the business is eligible for EMDG and the grant associated with it, after a proper valuation of the expenses is done with receipts, and the grant value is calculated.
Which kind of expenses can be categorized for the EMDG rebate?
Currently, there are only 8 types of expenses that can be categorized as expenses for the claims to stand for EMDG. They are listed below:
- Social Media Marketing Expenses
- Overseas Travelling Expenses
- Trade Fair Expenses
- Consultancy for Marketing
- Overseas Representation Personnel Charges
- Charges for visits of overseas buyers
- Distribution of free samples to overseas buyers
- Application for trademark and patents for the products
All these expenses have an individual cap limit, and a consultant helps in making the business understand the statute. Now that you know all that there is to know about the EMDG, it’s time for some real action!