Dáil Éireann Debate, Wednesday - 2 December 2020
47. Deputy Pádraig O'Sullivan asked the Minister for Finance if funding not drawn down or allocated from the stay and spend scheme could be ringfenced for the industry; and if he will make a statement on the matter. [40642/20]
View answerThe purpose of the Stay and Spend tax credit is to provide targeted support to businesses within the hospitality sector whose operations are likely to be most affected by continued restrictions. It provides relief direct to the consumer rather than the business and, as such, it would not be practicable to redirect the relief to the industry. As a demand led scheme, it is difficult to forecast the cost to the Exchequer in 2021 and 2022 of the measure. When it was announced in late July, it was tentatively estimated that the scheme could involve an Exchequer cost of about €270 million. This was an outside estimate based on 2.15 million individual taxpayers fully availing of a tax credit of €125.
The scheme is due to operate until 30 April next year but I do have the flexibility to extend it beyond that date.
However, much will depend on how matters unfold in the weeks and months ahead both in terms of the impact on take up and on associated costs. I will be monitoring the scheme, to see how it’s working and if any changes need to be made. We need to keep policies that are working, and change ones that might not be working as planned, but at all times, ensuring they are affordable.
However, to the extent that spending on the scheme may be less than the original cost estimate, this of course means that we need to borrow less and accumulate less debt.
Furthermore, it is important to recall that the Stay and Spend tax credit should not be viewed in isolation from the other measures I have put in place to support businesses generally and the hospitality sector in particular. The VAT reductions; the extension of the wage support scheme until next year and its extension to new or seasonal staff; and other Government measures all play a part in helping the sector cope with the challenges it faces.
