Posted: Tue 21st Feb 2023
The government has agreed a new €1.2 billion package of measures, which includes easier access to the Temporary Business Energy Support Scheme (TBESS) with a reduction in the threshold for businesses to qualify.
Also, a new grant for businesses using LPG or kerosene is to be introduced and the reduction on tourism and hospitality VAT remains until September.
Speaking about the package The Taoiseach said:
“For business, we’ve made it easier to apply for TBESS to help with electricity and gas bills, and the level of relief has been increased to 50% of the cost of eligible energy bills. There will also be a new grant for businesses using LPG or kerosene. The special reduced 9% VAT rate for hospitality businesses will be extended from March to August.”
The measures impacting small businesses are as follows:
The temporary reductions in VAT on gas and electricity, from 13.5% to 9%, will be extended to 31 October 2023 at an estimated cost of €115 million.
The temporary reduction in VAT on tourism and hospitality, from 13.5% to 9%, will be extended to 31 August 2023 at an estimated cost of €300 million.
A phased restoration of the rates of excise on petrol, diesel and marked gas oil will take place in three stages over the coming eight months. This will see rates restored on 1 June by six cent per litre of petrol, five cent per litre of diesel and one cent per litre of marked gas oil. On 1 September these rates will increase by a further seven cent for petrol, five cent diesel and one cent for marked gas.
Rates will then be fully restored on 31 October with a final increase of eight cent for petrol, six cent for diesel, and three cent for market gas oil. The extension, and phased reintroduction, of these excise reductions is estimated to cost €383 million.
The Temporary Business Energy Support Scheme will be extended to 31 May 2023 and enhanced, including by reducing the threshold for qualification from a 50% increase in electricity or gas costs to 30% increase (to apply retrospectively from 1 September last year), and by increasing from 1 March the level of relief from 40% to 50% of eligible costs, subject to a monthly limit, which will also be increased from March, to €15,000 per month per trade or profession, subject to an overall cap of €45,000 where the business is carried on from more than one location. These changes are subject to state aid approval from the European Commission. The cost of the extend scheme will be met from the allocation provided in Budget 2023.
There will also be a new grant for businesses using LPG or kerosene.
Minister Eamon Ryan added:
“I also welcome the extension of the temporary reduction in VAT on tourism and hospitality until the end of August, which will give those businesses a significant boost during the coming holiday season. The extension of the VAT reduction on the supply of gas and electricity until the end of October will also offer much needed help to families in meeting their energy bills.”