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‘Unprecedented’ 7.4 billion euro financial aid package unveiled

The package is intended to stimulate the economy.

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People on Henry Street in Dublin (Brian Lawless/PA)

People on Henry Street in Dublin (Brian Lawless/PA)

People on Henry Street in Dublin (Brian Lawless/PA)

The Irish Government has unveiled an unprecedented 7.4 billion euro financial aid package to help stimulate the economy.

A total of 50 individual measures aimed at helping every “significant area” of the economy in the State was announced.

Among the measures are a cut in the VAT rate from 23 to 21% which will run from September to February next year.

The waiver of commercial rates has been extended until the end of September, while a total of two billion euro in the Covid-19 Credit Guarantee Scheme will also be made available.

The help-to-buy scheme has also been expanded with first-time buyers allowed to claim up 30,000 euro, an increase of 10,000 euro.

A stay and spend initiative was also unveiled, which will allow people who spend up to 625 euro to claim back on income tax.

People must spend a minimum of 25 euro to avail of the scheme which is expected to run until next April.

The Pandemic Unemployment Payment (PUP) will also be extended until April next year, while the Temporary Wage Subsidy Scheme will also run until next year but will be referred to as the Employment Wage Support Scheme.

The PUP scheme, however will be gradually cut over time, with changes coming into effect from September.

The new maximum rate with amount to 300 euro a week, followed by a second rate of 250 euro and basic rate of 203 euro a week.

Speaking at the event in Dublin Castle, Taoiseach Micheal Martin said: “No-one should be in any doubt about the fact we are not returning to pre-March reality.

“The economic recession, which the pandemic has caused, is the most rapid and dramatic ever recorded.

“Emergency measures introduced in March, with all party support, have prevented a much deeper, social, and economic crisis.

“However, we now need to move to a new agenda, one which continues to try to limit the damage of the pandemic, which also moves on to help build a sustainable and inclusive recovery.”

Mr Martin said the Government is determined to protect as many businesses and jobs as possible.

Mr Martin said that capital funding will be provided to every school to help with ongoing and new refurbishment projects while support will be provided for new town and village renewal schemes.

Tanaiste Leo Varadkar said that as part of the financial package, there are two billion euros in loan guarantees.

He added: “There’ll be a six-month reduction in the VAT rate, going down from 23% to 21%.

“That’ll be particularly beneficial for the retail sector, furniture stores, clothing shops and also for pubs and restaurants.

“There’ll be a six-month commercial retail holiday for the vast majority of businesses.”

The restart grant, Mr Varadkar said, is being improved with a further 300 million euro in grants for small and medium businesses.

“The new grants will be open to more businesses, and the maximum amount available will increase from 10,000 euros to 25,000 euros and the minimum amount from 2,000 euros to 4,000 euros.

“We’re expanding the scheme to firms which employ up to 250 employees.

“We’re extending it as well to a small number of businesses and organisations that weren’t eligible in the past, including B&Bs and charity shops.”

Significant investment will be pumped into cycling and walking facilities in cities and towns in a bid to encourage more people to use bikes and walkways.

Employers will be paid 3,000 euro for every apprentice they hire under a scheme developed by Higher Education Minister Simon Harris.

Green Party leader Eamon Ryan said employers will be paid 2,000 euro in the first year and 1,000 euro in the second year if the apprentice is kept on.

Mr Ryan said: “To be honest, one of the biggest problems we have had to date was getting people to do apprenticeships.

“Now we will have thousands of young people potentially out of work so this scheme will help to address it.”

PA