Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

The tax debt warehousing scheme offered valuable and practical liquidity support to businesses during the Covid-19 pandemic and continues to support businesses as they recover from the impacts of the pandemic and the cost-of-living crisis. It assisted businesses with their cash flow in recent years, during difficult trading periods and certainly has, in many cases, prevented business failure.

The total debt in the warehouse has decreased substantially since the beginning of 2022 when the figure was more than €3 billion of warehoused tax debt for more than 100,000 customers. By late January this year, slightly more than €1.7 billion was warehoused for more than 57,000 customers and for 70% of those the businesses have outstanding liabilities of less than €5,000.

For the majority of businesses availing of tax debt warehousing, the amount they owe in warehoused debt is quite modest. However, I do not underestimate the challenge it is for many of them to pay it. The bulk of the debt, almost €1.5 billion, was warehoused by 5,265 customers with outstanding balances greater than €50,000. The vast majority of the warehoused tax debt is represented by just over 5,000 businesses. While payments can be made in advance, businesses do not have to pay all of their debt by 1 May 2024. Instead, they are required to engage with Revenue to make arrangements to pay the debt over an agreed period of time, based on their individual circumstances and capacity to pay.

The Revenue Commissioners have assured me that they are currently being flexible in terms of the warehousing regime. There is the possibility of a payment break, deferring the next payment due if there are cash flow issues, amending the payment date and so on. The Deputy is correct that I have been engaging with the Revenue Commissioners and with my officials. I have a further meeting on this issue today and I hope to finalise the further flexibilities on this issue very shortly. I would welcome the Deputy's views on that issue today.

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