A tax incentive for small businesses will be extended for six months as the Morrison government pledges $300m towards encouraging firms to invest.

With parliament resuming on Wednesday, the government is set to announce legislation to extend the life of a measure that allows small businesses to instantly write off the value of assets worth up to $150,000 per item.

It is the latest in a series of announcements of smaller economic stimulus measures, including last week’s $688m package offering grants for eligible singles and couples planning to build or renovate homes – a plan that Labor has vowed to scrutinise during the forthcoming parliamentary sitting.

The government estimates that as many as 3.5m businesses have annual turnover of less than $500m and are therefore eligible to benefit from the extension of the instant asset write-off – although it is unclear how many will actually take advantage of it.

Assets need to be first used or installed ready for use by 31 December – extending the 30 June cut-off that was part of one of the first major stimulus packages announced in March. Examples of eligible assets include trucks and tractors.

The treasurer, Josh Frydenberg, said the extended timeframe would help firms to invest in assets to support their business as the economy reopens and coronavirus health restrictions continue to be eased.

“They are designed to support business sticking with investment they had planned, and encouraging them to bring investment forward to support economic growth over the near term,” Frydenberg said in a joint statement with the employment minister, Michaelia Cash.

They said the move – to cost $300m over the budget cycle – would also help to improve cash flow for businesses by bringing forward tax deductions.

“Hardworking Australian businesses can rest assured that the Morrison government will do all that is necessary to support them to bounce back stronger and get to the other side of this crisis,” Frydenberg and Cash said.

While the initial move to increase access to the write-off for assets of up to $150,000 was announced in March, it is unknown how many firms have taken up the scheme so far, because they will report the data in their 2019-20 tax returns.

The government says it will need to legislate to give effect to the six-month extension.

That stands in contrast to the homebuilder program, which will provide grants worth $25,000 for eligible singles and couples intending to build a new home as a principal place of residence valued up to $750,000 including the land, or planning to renovate an existing property, with the upgrade valued at between $150,000 and $750,000.

Government sources confirmed on Sunday that the homebuilder program would be rolled out within existing partnership agreements with the states, and would therefore not be legislated before the parliament.

Labor has raised concerns, though, that the package will not do enough to support the building sector and does not include a program of social housing construction.

A spokesman for Jason Clare, the shadow housing minister, said: “It’s not surprising that they want to avoid legislation on this because there are some pretty obvious holes in this package that should be subject to scrutiny.”

The government has also signalled that a long-awaited rescue package for the arts and entertainment sector is imminent and is also considering changes to the jobkeeper wage subsidy scheme.

During the parliament fortnight, the government is also expected to face questions about its plan to reintroduce childcare fees from 13 July amid concerns of a potential drop-off in attendance once the costs are back.

The education minister, Dan Tehan, announced on Monday that the old childcare subsidy arrangements would return soon, because demand had been steadily increasing and the emergency relief package had “done its job”.

He revealed the government would stop paying the economy-wide jobkeeper wage subsidy to childcare services from 20 July, replacing this with a total of $708m in transition payments that he conceded may be less than the amount the sector would have received under jobkeeper.

Tehan said the government would ease the previous activity test until 4 October in a bid to support eligible families whose employment had been affected by Covid-19.

But Georgie Dent, the national campaign director of The Parenthood, said the advocacy group’s recent survey of 2,200 families had found that 42% of respondents indicated at least one parent was earning less as a result of Covid-19.

About a third of respondents reported they would need to reduce days or remove their children altogether if out-of-pocket fees returned to pre-Covid-19 levels.

“Given families are already so squeezed financially it’s awful to contemplate that getting back to work might not be possible simply because the cost of childcare is too high,” Dent told the Guardian.

“The announcement today indicates that the government either ignored what parents have said about the changes to their financial circumstances since Covid-19 or didn’t believe them.

“If a third of families are forced to reduce the number of days their children attend early education and care or remove them altogether, as they said they would be forced to if full fees returned, it will threaten the sector.”