Duncan Smith
Question:273. Deputy Duncan Smith asked the Minister for Finance the amount paid out under the stay and spend scheme; the amount budgeted for the scheme; and if he will make a statement on the matter. [12654/21]
View answerWednesday, 10 March 2021
Questions (273)
Written answers
The purpose of the Stay and Spend Tax Credit scheme is to provide targeted support to businesses within the hospitality sector whose operations are likely to be most affected by continued restrictions on public health grounds. In order to claim the Stay and Spend Tax Credit, taxpayers are required to upload a copy of their receipt(s) for qualifying expenditure to the Revenue Receipts Tracker and then make a formal claim for the tax credit when submitting their annual Income Tax Return.
To take the second part of the Deputy's question first, as I indicated on a number of occasions in response to Parliamentary Questions towards the end of last year, when the scheme was announced in late July 2020, it was tentatively estimated that it could involve an Exchequer cost of about €270 million. This was budgeted for over the two years 2021 and 2022 and was based on 2.15 million individual taxpayers fully availing of a tax credit of €125. Also, as was indicated at the time, the measure was introduced in anticipation that the economy would be on the way to being fully open, and there would be mobility across our country. We know now that this has not been the case for much of the period since the commencement of the scheme on 1 October 2020. Public health restrictions have had the effect of impeding the operation of the incentive as originally envisaged.
At the same time, since 1 October 2020, a total of 56,016 receipts have been uploaded to the Revenue Receipts Tracker, as at 4 March 2021. The related expenditure recorded on these receipts amounts to €9,207,244, and the potential tax cost is €1,841,449, assuming all such expenditure is claimed and qualifies in full for tax relief.
With regard to the Deputy's question about the amount paid out under the scheme, Revenue have advised me that when it comes to tax credits, some taxpayers will get refunds whereas some will have the credit to offset against underpayments along with a number of other credits they claim. As at 7 March 2021 a total of 8,995 claims have been included in Income Tax Returns for 2020 for the Stay and Spend credit. These claims relate to €3,206,048 of the qualifying expenditure recorded on the Revenue Receipts Tracker to date and the tax cost of same amounts to some €641,000. However, as the filing deadline for the 2020 Income Tax Return is not until 31 October 2021, information on the total number of claims and cost for the 2020 year of assessment will not be available until after the filing date and the returns have been processed. Subsequent to claims being made in respect of this new scheme and any other relief or deduction, verification of such reliefs and deductions forms part of Revenue’s comprehensive risk assessment programme.
Decisions on next steps relating to the scheme have yet to be taken and I will continue to assess matters as circumstances evolve.