A new tax-back scheme for people who holiday at home this summer is being developed by the Government.
he 'staycation subsidy' will see families able to reclaim a portion of their hotel or restaurant bill.
Independent.ie understands the proposal is emerging as the favoured way of giving a boost to the tourism industry in next week's July Stimulus Package.
However, sources said the exact rate of the rebate and how it will be administered has not been finalised.
The unprecedented scheme would be aimed at encouraging people to eat out and go on holidays in Ireland.
The Government has a number of options on the table including giving people vouchers to spend in hotels and restaurants. It's understood this has been ruled out as it could result in some businesses simply hiking prices.
VAT cuts were also debated but are now also unlikely to feature in the economic package, which is being described as a "mini budget".
Senior figures in Government raised concerns that a reduction in VAT would not be automatically passed on to the consumer.
However, it is hoped the staycation subsidy will put money in customers' pockets, allowing them to shop local and help get people back to work.
A similar scheme has been introduced by Britain's Chancellor Rishi Sunak as part of Britain's economic recovery plan.
Mr Sunak's "Eat Out to Help Out" scheme sees the government pay up to half of a person's restaurant meal to a maximum of £10 (€11) a head. A family of four could save £40 on a meal costing £80. The discount cannot go towards alcohol.
The Irish scheme would be targeted on hotels and restaurants, but it is unclear if pubs will be included.
A big focus of the package will be encouraging people to shop local and book staycations.
Health chiefs are increasingly concerned that people are engaging in foreign travel despite Government advice no to.
Work is also under way on a scheme to create jobs in communities that been hit by the lockdown.
Ministers are also expected to expand the Town and Village Renewal Scheme to encourage more local business.
Meanwhile, a cross-party Dáil committee has called for larger grants to help pandemic-hit businesses, an extension to the Temporary Wage Subsidy Scheme (TWSS), and the possibility of vouchers for the hospitality sector to form part of a stimulus package.
The Dáil's special committee on Covid-19 response published a report that includes 19 recommendations aimed at boosting the economy.
These include changing the Restart Grant Scheme to increase the average value of the grants and to make it available to more businesses.
The committee also says the Government must ensure that the TWSS remains available to firms that will operate below capacity due to Covid-19 and that "any tapering off of supports should have a significant lead in-time".
The report also says the Government should "examine the feasibility and benefits of a voucher scheme for all residents, to be spent supporting the domestic tourism sector".
Tánaiste and Enterprise Minister Leo Varadkar yesterday poured cold water on suggestions that such a voucher scheme - as proposed by Sinn Féin - should be included in the July stimulus.
He questioned how effective it would be in helping businesses that remain closed or restricted.
The report also recommends that consideration be given to the costs and benefits of reducing the VAT rate in the tourism and hospitality sectors.
It says the Government should increase the availability of apprenticeship schemes to reduce youth unemployment.
The report recommends that the commercial rates waiver should be extended to the end of the year for businesses that will continue to operate below capacity due to Covid-19.
Committee chairman Michael McNamara said: "The survival of many small businesses will depend on an injection of liquidity and the availability of other supports, and only the State can do this."