The Government has announced a €7.4 billion package of measures to stimulate an economy severely disrupted by the COVID-19 pandemic.

Taoiseach Micheál Martin said the measures would support small and medium businesses, support workers who had lost their jobs because of the pandemic and rejuvenate communities worst affected by the economic impact of the virus.

PUP extended

To help support jobs, a new Employment Wage Support Scheme (EWSS) will succeed the Temporary Wage Subsidy Scheme, and run until April 2021.

The Pandemic Unemployment Payment is also being extended to 1 April next year, though there will be gradual reductions in the amounts paid.

Loans

There will be zero interest for the first year of loans to small businesses through MicroFinance Ireland and the Strategic Banking Corporation of Ireland, as well as a €2 billion credit guarantee scheme.

The Restart Grant for businesses is also being extended to cover more firms and expanded to €550m, and a waiver of commercial rates is to be extended until the end of September.

The Government has also pledged €200m for training, skills development, work placement schemes, recruitment subsidies, and job search and assistance measures.

Reduction

The standard VAT rate is to be temporarily cut from 23% to 21%. The six-month reduction will start in September. There is no change, however, in the 13.5% rate for the hospitality sector.

A Stay and Spend tax relief scheme is aimed at encouraging Irish people to holiday at home.

Under the plan, any taxpayer spending over €625 on accommodation, food and non-alcoholic drinks, between October 2020 and April 2021, will be able to claim back €125 through a tax credit.