The largest Irish budget in history assumes there is no Brexit deal and no COVID-19 vaccine | Business news

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Ireland’s new coalition government presented its first budget in Dublin today, spending a lot of borrowed money to combat the economic damage of the pandemic and the threat of a no-deal Brexit.

The total package of 17.75 billion euros (16.1 billion pounds sterling), described by the country’s finance minister, Paschal Donohoe, as “unprecedented in its size and scale” and the largest in the world. history of the country, will include a national recovery fund of 3.4 billion euros to address the two main threats.

An additional € 4 billion will be awarded to the country’s health system to continue tackling the pandemic, including the provision of additional beds, personal protective equipment and tests.

A coronavirus advisory is displayed when pub doors are locked in the Temple Bar area, while Irish bars voluntarily close to slow the spread of the coronavirus, in Dublin, Ireland, on March 15, 2020. REUTERS / Lorraine O'Sullivan
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Hospitality will benefit from a VAT reduction until 2021, but that won’t help Dublin’s drink-only bars as they remain closed.

Donohoe told the Dail (Irish parliament), sitting at the Dublin Convention Center for social distancing reasons, that the 2021 budget was framed on the assumption that there would be no trade agreement between the UK and the EU, and that there would be no there would be “COVID-19 vaccine widely available in the next year.

The stark nature of his message was underlined by a forecast of a deficit of € 20.5 billion for 2020, along with the loss of 320,000 jobs by the end of the year, although the government expects a recovery of some 155,000 jobs in 2021 .

The staggering cost of the pandemic was underscored when the minister said that the total value of COVID-19 support measures so far amounts to € 24.5 billion.

Among the main measures of the 2021 Budget:

  • A recovery fund of 3.4 billion euros
  • An additional € 4 billion for the health service
  • An Extension of Ireland’s COVID Wage Allowance Scheme for Employees
  • A new support scheme for businesses closed due to coronavirus restrictions
  • No change in income tax
  • VAT for the most affected hospitality sector will be reduced from 13.5% to 9% as of November 1
  • The carbon tax will increase by € 7.50 per tonne per year
  • Taxes on gasoline and diesel will increase
  • A pack of cigarettes increased by 50 cents bringing the cost to € 14
Some people wear face masks when they walk past shops in Dublin.
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Ireland has applied some of the strictest coronavirus restrictions in Europe to limit pressure on its hospitals.

There were no big budget surprises, many of which had been widely pointed out beforehand.

Mr Donohoe said that Ireland would prevail and closed his speech with a quote from the poet Seamus Heaney: “If we get through the winter, we can spend the summer anywhere.”

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