9% VAT and Supports in Recovery Plan

The Economic Recovery Plan sets out how the Government will reboot the economy and get people back to work as the country begins to emerge from the Covid-19 pandemic.  It includes more than €3.5 billion in spending supports and just under €1 billion under the EU's Recovery and Resilience Fund.   This will "help kick start a jobs-led economy", Taoiseach Micheál Martin said.

​Here are some of the key points from the plan which impact on the tourism and hospitality sectors:

• The 9% VAT rate for tourism and hospitality will be extended until 1 September next year.
• The plan also includes several supports for the live performance sector, as well as a pilot scheme to guarantee a basic income for artists.
• A new scheme, the Music and Entertainment Business Assistance Scheme (MEBAS) will be introduced to support the live entertainment sector.
• The plan states that 'additional support’ may be required for the aviation sector’s recovery as it opens up.
• Previously Government agreed an €80m funding package for Irish aviation for 2021. 
• The Pandemic Unemployment Payment will continue at its current level until September, when gradual reductions will begin.  It will be reduced by €50 from 7 September, with further €50 cuts planned for 16 November and 8 February next. PUP claims for students will be extended until the start of the 2021/2022 college year, with the final payment on 7 September - in line with normal circumstances where students don't qualify for unemployment payments while at college.
• The Enterprise Support Grant of €1,000 for self-employed people returning to work will also be continued to assist self-employed sole traders, leaving PUP, to meet re-start costs.

 
Will the EWSS be extended?

• The Employment Wage Subsidy Scheme will be extended until the end of the year and businesses may apply for enhanced reopening payments.  For the third quarter of the year, the Government has decided to broadly maintain the status quo for EWSS, including the enhanced rates of support and the reduced rate of Employers' PRSI with a modification to widen eligibility.  While the EWSS has been extended for the final three months of the year, the Government said it is too early to decide on the operational parameters of the scheme for that period.  It will make a decision closer to the time - around the end of August or early September.
•  The Covid-19 Restrictions Support Scheme will be extended beyond 30 June until the end of the year.  As firms are able to re-open and exit the scheme, there will be an enhanced restart payment of three weeks at double rate of payment to support businesses in meeting the costs of re-opening as they exit the scheme.  The maximum re-start payment will be increased to €10,000 per week, allowing businesses to receive up to a maximum of €30,000.
• In addition to these supports, a new Business Resumption Scheme (BRSS) will be introduced in September.  It is designed for 'vulnerable but viable' businesses, particularly in sectors that were significantly impacted throughout the pandemic, even during periods when restrictions were eased.  Businesses whose turnover is reduced by 75% between 1 September 2020 and 31 August 2021, compared with 2019 will be eligible.  The scheme will not be restricted by location, rate paying or physical premises.  The BRSS will be administered by Revenue and will operate in a similar way to CRSS.
• Meanwhile, the Commercial Rates Waiver will be extended until the end of September in its current form and the Tax Debt Warehousing Scheme will be extended until the end of the year.  
• The enhanced Covid-19 illness payment will also remain available to those diagnosed with Covid-19 or asked to remain away from work as a close contact.

 
What is in the plan to help the worst hit sectors?
 
 The Government also detailed how it will spend its €915m portion of the EU's €750 billion Recovery and Resilience Fund to help member states recover from the pandemic.
 
It said the money will be focused on the country's green transition, including a low-cost loan scheme to retrofit homes and in retraining 100,000 people by 2025.

REF: hospitailityenews.ie