Dáil Éireann Debate, Wednesday - 17 January 2024
346. Deputy Ivana Bacik asked the Minister for Finance the number of businesses in each county which availed of mechanisms to warehouse tax debt; the types of businesses which availed of the measure by county, in tabular form; the size of businesses which availed of the measure by county; and if he will provide a list of businesses which availed of the measure, in tabular form. [1106/24]
View answer347. Deputy Ivana Bacik asked the Minister for Finance if he will detail his engagement with the restaurant sector in respect of the warehousing of tax debt in each year since 2021; and his plans to engage with the sector in 2024. [1107/24]
View answer348. Deputy Ivana Bacik asked the Minister for Finance his plans to amend the terms of reference of the repayment of warehoused tax debt by businesses due to Covid-19 with respect to the provision of a timeline for repayment, the payment of a lump sum, and engagement with the Revenue Commissioners on the matter, respectively. [1108/24]
View answer349. Deputy Ivana Bacik asked the Minister for Finance if his Department possesses forecasting on the anticipated effect on businesses of the May 2024 deadline for repayment of warehoused tax debt with respect to job losses, future loss of tax payments, business closures and other matters; and, if so, if he will supply that forecasting. [1109/24]
View answer350. Deputy Ivana Bacik asked the Minister for Finance if he will make a statement on the anticipated effect on businesses of the May 2024 deadline for repayment of warehoused tax debt with respect to job losses, closure of businesses and any other relevant matter. [1110/24]
View answer360. Deputy Joe Flaherty asked the Minister for Finance the number of businesses that have availed of the debt warehousing scheme, by county; and the amounts owing, per county. [1486/24]
View answerI propose to take Questions Nos. 346, 347, 348, 349, 350 and 360 together.
The Tax Debt Warehousing Scheme has offered valuable and practical liquidity support to businesses during the COVID pandemic and continues to support businesses as they recover from the impacts of the pandemic and the cost of living crisis. It has assisted businesses with their cash-flow during difficult trading periods, preventing business failure.
A significant extension to the scheme, announced in October 2022, means that businesses have until 1 May 2024 to make arrangements to repay their warehoused debt. In advance of this deadline, Revenue will engage with all customers with debt in the warehouse at that time to discuss their payment options and agree a tailored phased payment arrangement in respect of their warehoused debt based on their individual circumstances. This will enable businesses secure their viability into the future while still meeting the requirements of the debt warehousing scheme, including the requirement that current liabilities are filed and paid on time.
Revenue have confirmed to me since the commencement of the debt warehousing scheme, Revenue has written on a number of occasions to businesses availing of the scheme (including the hospitality sector) providing each business with a schedule of their warehoused debt and reminding them of their obligations under the scheme to ensure they retain the warehouse benefits. In advance of 1 May 2024, Revenue will write again to all businesses with debt in the warehouse at that time, providing details of their debt and advising on the repayment options available, including agreeing tailored payment arrangements.
On an ongoing basis as part of standard debt management processes, Revenue is reminding businesses (including those in the hospitality sector) of the need to ensure current liabilities are filed and paid on time, which is a key condition of the scheme.
Since July 2023, Revenue has been directly engaging with businesses, starting with those with highest warehoused debt, to encourage them to consider their payment options, including agreeing tailored phased payment arrangements. Revenue continues to engage directly with businesses at every opportunity to outline the payment options available for the repayment of their debt and to encourage the setting up of payment plans as early as possible. In addition, Revenue will be holding informational events/webinars for business representative bodies and sectoral groups from January 2024 onwards to further raise awareness and engage with businesses with warehoused debt, particularly businesses in the SME and hospitality sectors.
In respect of engagement with the restaurant sector since 2021, I would note that, each year, in advance of the Budget, both I and the previous Minister for Finance have met with representative groups from the hospitality sector. Last year, I met with representatives of the Irish Hotels Federation, the Restaurants Association of Ireland, the Licensed Vintners Association, the Vintners Federation of Ireland and the Irish Tourism Industry Confederation. The Tax Debt Warehousing scheme was not specifically raised at this meeting. Revenue also had a meeting with the CEO of the Restaurants Association of Ireland in December 2023 in relation to the debt warehousing scheme and a webinar with the Association is scheduled for 30 January 2024.
Revenue have further advised me that their approach to the repayment of warehoused debt will be flexible to facilitate the agreement of tailored payment arrangements appropriate to business circumstances. Payment arrangements can be activated now in advance of 1 May 2024. A minimal down payment will activate the arrangement and monthly repayments can be scheduled to commence from May 2024 onwards. If there is a change in circumstances during the term of the payment arrangement, a number of additional flexibilities are available to address any payment difficulties that may arise such as options to take a payment break, deferral of next payment due, amendment to payment date and amendment to monthly payment amounts.
In summary, Revenue have indicated that they will be flexible in relation to the payment plans on warehoused debt and will work with businesses in the scheme so that they can secure the viability of their business into the future. This is subject to the key requirement that current liabilities are filed and paid on time.
Regarding the anticipated effect on businesses of the May 2024 deadline for repayment of warehoused tax debt, Revenue have informed me that no formal forecasting of the effect on businesses has been undertaken. However, Revenue will work proactively with businesses and give them every possible support in managing the repayment of their warehoused debt over a timeline that suits the circumstances of the business. Revenue has a proven track record in agreeing flexible Phased Payment Arrangements that take account of the financial circumstances of each business and their capacity to pay. These flexibilities include, as mentioned above, a reduced down payment amount to commence the payment arrangement, an extended payment duration and the availability of payment breaks and payment deferral when temporary cash flow difficulties arise during the arrangement term.
Taking the Accommodation and Food Service sector as an example, while approximately 5,600 customers in this sector have warehoused debts amounting to €268 million, it should be noted that 1,400 (25%) of these have warehoused debts of less than €100. A further 700 (13%) have warehoused debts between €101 and €1,000 and 950 (17%) have warehoused debts between €1,001 and €5,000.
Revenue have confirmed the total debt amounting to €1.747 billion is currently warehoused for 57,703 customers, of which almost 70% is for amounts less than €5,000. The bulk of the debt (€1.5 billion) is warehoused by 5,347 customers, who have outstanding balances greater than €50,000. The total debt warehoused has decreased by €1.4 billion since January 2022.
The following table outlines the number of customers and amount of debt currently in the Debt Warehouse, broken down by county.
|
County |
Customer Count |
Debt in Debt Warehouse (€m) |
|
Dublin |
16,168 |
912 |
|
Cork |
6,067 |
136 |
|
Galway |
3,233 |
85 |
|
Kildare |
2,694 |
65 |
|
Meath |
2,470 |
56 |
|
Limerick |
2,116 |
50 |
|
Wicklow |
1,980 |
40 |
|
Wexford |
1,905 |
35 |
|
Tipperary |
1,887 |
25 |
|
Donegal |
1,880 |
26 |
|
Kerry |
1,757 |
32 |
|
Louth |
1,636 |
38 |
|
Mayo |
1,539 |
25 |
|
Waterford |
1,451 |
21 |
|
Clare |
1,322 |
20 |
|
Westmeath |
1,142 |
24 |
|
Kilkenny |
1,067 |
18 |
|
Cavan |
874 |
12 |
|
Sligo |
783 |
11 |
|
Laois |
775 |
12 |
|
Monaghan |
765 |
15 |
|
Offaly |
755 |
11 |
|
Carlow |
737 |
19 |
|
Roscommon |
713 |
8 |
|
Longford |
505 |
9 |
|
Leitrim |
423 |
6 |
|
Other* |
1,059 |
36 |
|
Total |
57,703 |
1,747 |
*Other relates to specialised cases which cannot be defined on a county basis.
The following table gives the types of businesses currently availing of the Debt Warehouse scheme broken down by NACE Sector. A sectoral breakdown by county is not available.
|
Sector |
Customer Count |
|
Construction |
9,202 |
|
Wholesale and retail trade, repair of motor vehicles and motorcycles |
8,636 |
|
Professional, scientific and technical activities |
6,770 |
|
Accommodation and food service activities |
5,586 |
|
Other services |
3,529 |
|
Manufacturing |
3,118 |
|
Agriculture, forestry and fishing |
3,070 |
|
Human health and Social Work activities |
2,492 |
|
Administrative and support service activities |
2,399 |
|
Transportation and storage |
2,312 |
|
Information and Communication |
2,227 |
|
Real estate activities |
2,126 |
|
Education |
1,935 |
|
Arts, entertainment and recreation |
1,552 |
|
All other Sectors/Unknown |
1,397 |
|
Financial and insurance activities |
724 |
|
Water supply, sewerage, waste management and remediation |
198 |
|
Public administration and defence, compulsory social security |
167 |
|
Activities of households as employers; undifferentiated goods- and services-producing activities of households for own use |
128 |
|
Mining and quarrying |
76 |
|
Electricity, gas, steam and air-conditioning supply |
52 |
|
Activities of extra-territorial organisations and bodies |
7 |
|
Total |
57,703 |
Revenue’s Business Division manages enterprises with an annual turnover less than €3 million, which accounts for the majority of business taxpayers. Personal Division deals with all business entities with no trade or professional income such as trusts, charities, sporting bodies. Medium Enterprises Division deals with businesses with an annual Irish turnover of more than €3 million (but less than €190 million) as well as the subsidiaries/parents of such companies. Large Corporates Division deals with the largest companies with an annual Irish turnover of more than €190 million per annum and High Wealth Division deals with high wealth individuals.
The following table shows the size of businesses currently availing of the Debt Warehouse Scheme by reference to their assigned Division with Revenue. A Divisional breakdown by county is not available.
|
Division |
Customer Count |
|
Business |
53,416 |
|
Personal |
2,644 |
|
Medium Enterprises |
1,555 |
|
Large Corporates |
60 |
|
Large Cases – High Wealth Individuals |
28 |
|
Total |
57,703 |
The Deputies may be aware that, in accordance with Section 851A of the Taxes Consolidation Act 1997, Revenue is statutorily bound to confidentiality in respect of taxpayer information and is therefore precluded from disclosing taxpayer information. Revenue cannot, therefore, provide a list of businesses who availed of the Debt Warehousing Scheme.
