The ACT government agreed on Friday to expand the community contributions scheme to allow clubs to claim back what they pay artists to perform.

The changes will also allow technical support to be covered as a community contribution, as well as the cost of hiring the venue.

ACT clubs will have the opportunity to cover the cost as part of the 8.8 per cent of net gaming machine revenue they are required to spend on charitable initiatives.

They will still be required to spend a minimum of 0.4 per cent to a gambling harm-prevention fund and the same amount to the chief minister's charitable fund.

Manager of the Harmonie German Club Paul Berger said prior to the pandemic the club would put on shows every weekend, with up to three performances some weekends.

The line-up of around 50-60 bands to perform at the Narrabundah venue last year included Marcia Hines, The Wolfe Brothers, Bondi Cigars, Travis Collins, Amber Lawrence, John Schumann and Ash Grunwald.

With social-distancing restrictions its auditorium capacity went from 300, with a mezzanine level capacity of 100, to 80 people.

Mr Berger said live music was economically a massive part of its business and key to its efforts to diversify from reliance on gaming revenue.

"Over the past few years we have invested heavily in our auditorium and live music," Mr Berger said.

"We were at the stage where the combination of ticket sales, bar and food revenues, are more than $1 million a year."

He said since live music had come to standstill the club had taken a huge hit.

"The impact this has had on our supply chain has been enormous," Mr Berger said. "On most occasions [prior to COVID-19] the ticket sales are entirely returned to the artist. These artists have lost the ability to be paid for their craft.

"We have an agreement with sound and lighting company Elite Technologies. They, too, have been impacted and have lost the ability to provide a service.

"The financial impact has been catastrophic."

Mr Berger said the community contribution initiative was fantastic and would help them cover the costs of professional PA and lighting.

"Ongoing we could go back to offering our artists a much-needed guarantee for their services and not be hamstrung by low ticket sales. The live music industry, including the entire supply chain, have been worst hit [by coronavirus] by a long way," he said.

ClubsACT chief executive Gwyn Rees welcomed the announcement. He said clubs were key part of live music in the ACT.

"In a usual year, clubs account for almost half of the live music spend in the ACT - more than hotels, bars, live music venues and nightclubs combined," Mr Rees said.

"We believe they should be assisted in helping the live music industry get back on its feet in Canberra."