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Ireland Extends Main COVID-19 Supports For Firms, Tapers Others

Ireland extended the main financial supports for firms hit hard by the COVID-19 pandemic on Tuesday and announced the first phasing out of other emergency measures, with coronavirus-related jobless payments to be tapered from September.

The government has propped up the economy with support worth €38 billion ($46.46 billion), or nearly 20% of national income, having had one the strictest lockdown regimes in Europe for the last 15 months.

The state is emerging from its third and longest shutdown.

Ministers agreed to extend commercial rates waivers until the end of September, continue to give grants to firms with significantly reduced turnover beyond that point and keep wage subsidies and tax debt warehousing going until the end of 2021.

"Our aim is not simply to return to the situation as it was early last year and let's be clear there is enormous damage to be undone. Our core objective is to restore and then go beyond pre-pandemic employment levels," Taoiseach Micheál Martin told a news conference.

Pandemic Unemployment Payment

Ireland's unemployment rate was just below 5% when the pandemic began. The number of people temporarily or permanently out of work stood at 22.4% at the end of April, with around three in four on the Pandemic Unemployment Payment (PUP).

Public Expenditure and Reform Minister, Michael McGrath said he expected that cohort to fall very significantly over the coming weeks as shops, restaurants, pubs and hotels reopen ahead of the phasing out of the PUP between September and February 2022.

Lower VAT Rate For Hospitality

Other measures announced on Tuesday include keeping a lower 9% VAT rate for the hospitality sector until September 2022.

Ireland also laid out how it will spend its €915 million portion of the EU's €750 billion fund to help member states recover from the pandemic.

The money will be focused on Ireland's green transition, including a low-cost loan scheme to retrofit homes and in retraining 100,000 people by 2025.

The Central Bank has estimated this many people could lose their jobs permanently due to the pandemic.

News by Reuters edited by Donna Ahern, Checkout. For more retail news click here. Click subscribe to sign up for the Checkout print edition.

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