The jobs stimulus package, presented 23 July 2020, includes measures that focus on protecting and stimulating jobs and represents the next phase in the government’s economic plan to deal with the ongoing challenges of the coronavirus (COVID-19) pandemic.
Draft legislation supporting these measures was issued on 24 July 2020 in the form of the “COVID-19 (no.2) 2020 Bill.”
A jobs-led recovery from the serious economic impact of the COVID-19 pandemic is at the heart of the overall strategy and this latest announcement is a forerunner to a National Economic Plan to be introduced later this year. The jobs stimulus package includes a mixture of tax and grant-based provisions aimed at aiding businesses to “get back on their feet” post-lockdown and to prepare for a new reality. Maintaining employment in addition to implementing several measures to support individuals who have lost their jobs as a result of the pandemic is central to the latest announcements.
The tax measures include items to stimulate demand, such as a temporary 2% reduction in the standard value added tax (VAT) rate, from 23% to 21% for a six-month period beginning 1 September 2020, and the introduction of a “stay and spend” incentive.
The package of tax measures for business has a clear focus—to facilitate tax refunds for those businesses that were profitable in 2019 and to provide relief for businesses that are struggling to pay their tax liabilities in 2020, with measures such as the waiver of commercial rates to the end of September 2020, the early carryback of losses to the prior period, the warehousing of VAT and PAYE liabilities, and the reduction of the interest rate on all tax debts to 3%.
Read a series of reports on the July jobs stimulus package prepared by the KPMG member firm in Ireland
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