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Mixed reaction to July stimulus package

Disappointment that measures won't help tourism in Border area

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Minister for Enterprise Leo Varadkar, Taoiseach Micheal Martin and Minister for Climate Action Communications Networks and Transport Eamon Ryan leaving the Cabinet Meeting in Dublin Castle following the Government announcement of the stimulus package. Photo: Stephen Collins /Collins Photos Dublin

Minister for Enterprise Leo Varadkar, Taoiseach Micheal Martin and Minister for Climate Action Communications Networks and Transport Eamon Ryan leaving the Cabinet Meeting in Dublin Castle following the Government announcement of the stimulus package. Photo: Stephen Collins /Collins Photos Dublin

Minister for Enterprise Leo Varadkar, Taoiseach Micheal Martin and Minister for Climate Action Communications Networks and Transport Eamon Ryan leaving the Cabinet Meeting in Dublin Castle following the Government announcement of the stimulus package. Photo: Stephen Collins /Collins Photos Dublin

The July Stimulus package, which was announced last week, is like the proverbial curate's egg - both good and bad in parts.

That's the view of Dundalk Chamber of Commerce, whose PRO Paddy Malone says that while there 'are good elements to it, it hasn't been thought through properly.'

On the plus side he says: 'We were pleased to see the pandemic unemployment payment, PUP and the wage subsidy scheme continue, including the relaxation of some of the qualifying conditions and we were also pleased to see the increase in the amount and the expansion of the restart grant.'

He also welcomed the additional funding for upskilling and training, pointing out that there had been a huge demand for this from both employers and employees in the last few months.

Funding for special Brexit advisors was also welcomed, with Paddy adding 'We have been reminding members that issue has not gone away.'

On the downside, he said that there were number of areas where the Government did not go far enough and he found the failure to reduce VAT for tourism to be 'very disappointing.'

'The first is the failure to reduce the hospitality VAT rate down to match the UK rate of 5%. The hospitality and tourism industry in this area has always been neglected by Dublin but this highlights the problem.'

He said local restaurant owners were particularly concerned about the disparity and feared losing custom to establishments across the Border.

As an accountant, he foresaw problems with the offer of a tax credit on staycation between October and April, citing the large number of people who don't claim back tax for medical expenses. Likewise, he felt that people won't avail of this as it involves downloading an app and filling in forms.'It's very messy and overly complicated.'

The fact that the scheme only comes into operation from October means that families holidaying at home this summer will miss out.

He said the scheme also fails to cater for 'the grey Euro'.

'There are retired people on modest pensions, not paying tax and without mortgages who are in a position to take a mid-week break. The tax credit is of no interest to them.'

'In the October budget we would hope to see a more targeted approach, giving priority to areas with high employment potential, particularly the young. We would like to see an overhaul of the rates burden on business and we would like to see a concerted effort on interest rates.'

The Restaurant Association of Ireland also criticised the July Stimulus package saying: 'No decrease in Tourism VAT rate is a nail in the coffin for border Restaurant & Hospitality businesses.

McGahon welcomes measures

Louth Fine Gael Senator John McGahon has welcomed the July Stimulus package saying that the new €7.4bn suite of measures will help get Louth businesses back on their feet and get as many people as possible back to work quickly while continuing to manage the impact of COVID-19.

He was pleased that the new Employment Wage Support Scheme will succeed the Temporary Wage Subsidy Scheme and run until April 2021.

'Employers in Louth whose turnover has fallen 30% will receive a flat-rate subsidy of up to €203 per week per employee, including for seasonal staff and new employees,' he said. 'New firms operating in impacted sectors will also be eligible. The scheme will support around 350,000 jobs into the beginning of next year.'

'The restart grant for enterprises will benefit a range of SMEs. It will be expanded by €300m bringing the total funding to €550m. The payment level is being increased to €25,000. Further payments may be available to those firms which have already received them. Other businesses, such as B&Bs across Louth, not previously included in the scheme, will now be eligible.'

Businesses forced to close due to public health requirements will be granted a waiver of commercial rates for the six months to end-September 2020.

Senator McGahon said those without work - especially young people - need as much support as possible.

'The Pandemic Unemployment Payment, due to end in August 2020, is being extended until April 2021. We know that this is extremely helpful to those not working. We have heard that testimony repeatedly. This will provide security for households across Louth as job opportunities return.

'To help restore consumer confidence and support retailers and businesses across Louth, there will be a 6-month reduction in the standard rate of VAT from 23pc to 21pc, from the beginning of September.

'Our tourism sector has been crippled by Covid-19. A new Stay and Spend incentive will allow any taxpayer who pays over €625 on accommodation, food and non-alcoholic drinks, between October and April 2021, claim back up to €125 through a tax credit.

'Housing is a priority for this Government and further levels of support under the Help to Buy Scheme at cost of €18m will be made available.

'Until the end of this year, buyers will be able to reclaim up to 10pc, or a maximum of €30,000 of the price of a new build, up from 5pc or €20,000 previously.

Senator McGahon noted that the package 'also contains a €20m Brexit fund to help SMEs involved in exporting and importing with the UK and further afield to equip themselves for new customs arrangements from next January.

Senator McGahon continued: 'COVID-19 has had an enormous impact on communities, businesses, families and individuals across Louth.'

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