Dáil Éireann Debate, Wednesday - 26 April 2023
68. Deputy Ged Nash asked the Minister for Finance the amount of warehoused income tax liabilities and VAT liabilities at the end of March 2023; the amount of interest that is projected to accrue over the remainder of 2023; and if he will make a statement on the matter. [19796/23]
Amharc ar fhreagraThe Debt Warehousing scheme allows for the deferral of the payment of VAT, PAYE (Employer) and certain self-assessed income tax liabilities, including TWSS and EWSS overpayments. It provided a vital liquidity support to businesses during the Covid pandemic and continues to support businesses as they recover from the impacts of the pandemic and the current energy crisis.
At the end of March 2023, the value of all debts warehoused was €2.216 billion for 63,600 customers. Of this, VAT liabilities amounted to €1.049 billion, income tax liabilities amounted to €55 million, this includes PRSI of approximately €7 million, Employers PAYE liabilities amounted to €999 million, this includes PRSI of approximately €355 million, and TWSS and EWSS liabilities amounted to €113 million.
The extension announced in October 2022 means that businesses no longer have the challenge of making arrangements to repay their warehoused debt until 1 May 2024 and this significant additional time should greatly support businesses and prevent business failure. Importantly also, businesses are still able to avail of the reduced 3% interest rate from 1 January 2023, as opposed to the general interest rate of 10% when they come to pay the debt. To reduce their interest bill, some businesses have already begun to repay their warehoused debt where their financial circumstances permit and, to date, just over 2,000 customers have agreed payment arrangements with Revenue for warehoused debt of €73 million.
The number of customers in the warehouse and the associated warehoused debt is not static and fluctuates on an ongoing basis due to a number of factors, such as the timing and frequency of customer repayments of their warehoused debt. In the circumstances, it is not feasible to accurately project an amount of interest that may accrue on warehoused debt over the remainder of 2023. When customers come forward to repay their warehoused debt, or to make an arrangement to repay it over a period of time, the interest accrued will be calculated at that point on a case-by-case basis.
