Neale Richmond
Question:360. Deputy Neale Richmond asked the Minister for Finance the Covid-19 supports that are available for businesses that began trading after 26 July 2021; and if he will make a statement on the matter. [2294/22]
View answerWednesday, 19 January 2022
Questions (360)
Written answers
The Employment Wage Subsidy Scheme (EWSS) is an economy-wide scheme that operates across all sectors for eligible businesses in respect of eligible employees. The objective of the EWSS is to support employment and maintain the link between the employer and employee insofar as is possible. The EWSS has been a key component of the Government’s response to the Covid-19 crisis.
In money terms, the overall support provided to-date (13th January) by EWSS is over €7 billion comprising direct subsidy payments of €6.12 billion and PRSI forgone of €956 million to 51,900 employers in respect of over 706,700 employees.
The EWSS legislation provides that for employers to be eligible for the EWSS, they must be able to demonstrate that their business will experience a 30% reduction in turnover or customer orders for the calendar year 2021 compared to the calendar year 2019 and that this disruption to normal business is caused by the COVID-19 pandemic. The EWSS is open to any eligible employer across all sectors who was trading before 31 December 2021.
As the Deputy may be aware, as announced on 9th December the enhanced rates of EWSS subsidy would apply for a further two months, December 2021 and January 2022. This will give certainty to businesses when they need it most.
The Government and I have been clear that there will be no cliff edge to supports for employers but we have also been clear that the EWSS cannot run indefinitely, nor is it sustainable to continue with the enhanced rates for a prolonged period of time given the very substantial costs to the Exchequer.
As such, from 1 February 2022, the original two-rate structure of €203 per week and €151.50 per week will apply; for March and April 2022 the flat rate subsidy of €100 per week will apply and the scheme will end on 30 April 2022.
The Government further announced on 21th December 2021, that the EWSS will reopen for certain businesses who would otherwise not be eligible and that such businesses can continue to be supported until the expiry of the scheme on 30 April 2022. The new arrangements for EWSS will provide employers who have previously availed of EWSS but who are no longer eligible, with the opportunity to re-qualify for the scheme where they meet certain conditions. Broadly, to re-qualify the business must experience a 30% reduction in turnover, or customer orders during a particular reference period. Further details of the qualifying conditions can be located on my Department’s website at the following link- www.gov.ie/en/press-release/bf5d1-government-announces-significant-expansion-of-supports-for-businesses-affected-by-the-latest-public-health-restrictions/.
Employers that qualify for re-entry to the scheme will receive support on a prospective basis from 1 January 2022 onwards, and they can remain in the scheme until its expiry date (30 April 2022).
The Tax Debt Warehousing Scheme remains available to support businesses that are experiencing tax payment difficulties arising from the COVID-19 pandemic. The scheme, which has to date provided €2.9 billion in liquidity to approximately 98,000 businesses, applies to VAT debts, PAYE (Employer) debts, certain self-assessed income tax debts and overpayments of both the Temporary Wage Subsidy Scheme (TWSS) and the EWSS. Access to the scheme is automatic for SMEs managed by Revenue's Business and Personal Divisions and by agreement with larger business managed by Revenue's Large Cases and Medium Enterprise Divisions. To qualify for debt warehousing, businesses must continue to file all tax returns, even though the liability cannot be paid.
On 20 December 2021 the government agreed to extend the tax debt warehousing scheme to extend the period where liabilities arising can be "warehoused" to the end of Q1 2022 for taxpayers eligible for the COVID-19 support schemes; this means that interest free period for those taxpayers will now be 1 April 2022 to 31 March 2023, extending the period by 3 months from 31 December 2022.
To answer the Deputy’s specific question, depending of the particular circumstances of the business, the aforementioned supports may be available to businesses that commenced trading after 26 July 2021.
The full range of supports provided by the Government is available on the Department of Enterprise, Trade and Employment’s website at the following link -enterprise.gov.ie/en/What-We-Do/Supports-for-SMEs/COVID-19-supports/.
Finally, as has been the case throughout the pandemic, the Government will continue to monitor developments closely.