As the COVID-19 pandemic hit Australia in March and workers moved home in droves, McKinsey estimates global technology adoption advanced about five years in just eight weeks.

A third of Australian businesses expanded their online presence and one in four changed their mode of delivery, a survey by the Australian Chamber of Commerce and Industry found in April.

Ahead of next week's federal budget, Treasurer Josh Frydenberg has flagged $800 million in spending to support businesses to increase their digital capability and reduce red tape in the digital world.

"The governments' Digital Business plan is targeted at building on this digital transformation of Australian businesses to drive productivity and income growth and create jobs," Mr Frydenberg said.

"Our Digital Infrastructure package is estimated to increase Australia's GDP by $6.4 billion a year by 2024 and around $1.5 billion of this additional economic activity is estimated to flow to regional Australia each year."

More than $250 million will be spent to expand the government's digital identity program to businesses, making it easier to start a business and register as a director using the myGovID program to be verified.

It's set to reduce the amount of time it takes to register an Australian Business Number, register for GST and payroll in 15 minutes.

The government estimates it would have a potential economic saving of $236 million over five years, if all new businesses were to use the digital identity.

Expanded use of the MyGovID would also allow applications for the JobSeeker and Youth Allowance payments to be done completely online, something that wasn't in place before the pandemic, causing queues outside Centrelink offices across the country as jobs were lost overnight.

Among the new measures is $19.2 million for small businesses to "go digital," $3 million to develop a "digital readiness assessment" for businesses to assess their digital maturity and funding for a platform for people to find digital skills training.

"Australian industries and businesses are well placed to make the most of the opportunities offered by digital technologies but we need to take further steps to support small businesses adopt the digital capabilities to survive, thrive and grow," Mr Frydenberg said.

Opening the door to businesses to be more digital-savvy will help the economy as it recovers from the COVID-19 pandemic and recession, the government says.

"The plan supports Australia's economic recovery by removing out-dated regulatory barriers, boosting the capability of small businesses and backs the uptake of technology across the economy," Prime Minister Scott Morrison said.