Paschal Donohoe (Dublin Central, Fine Gael) | Oireachtas source

What the Bill before the House does is provide a legislative basis for a number of changes to the main Covid supports that were announced by the Government since the end of last year and that are currently being implemented by the Revenue Commissioners on an administrative basis. Members will recall that the additional public health restrictions in place at the end of last year necessitated additional supports for those businesses most impacted. We are dealing with some other matters in the Bill, such as the tax treatment of payments for decommissioning of fishing vessels and a provision to ensure that the pandemic special recognition payment is made tax-free. We are also going to deal with a number of taxation measures in respect of the cost of living: the excise reduction for petrol and diesel, changes that have been made to marked gas oil and also measures that have been made to deal with, for example, the announcement that the Government made today regarding the 9% VAT rate.

Section 1 deals with the normal definitions that are included in legislation of this kind.Section 2 of the Bill deals with a number of different changes in the employment wage subsidy scheme, EWSS. This section provides for further enhancements to the scheme in response to public health situations that developed last December and in the early part of the year. The scheme was reopened for certain businesses that would otherwise not have been eligible, as announced on 21 December. Enhanced support was provided to businesses directly affected by the public health regulations introduced in late December 2021, with a delay in the step-down arrangements to such firms that would continue to receive support until the end of May.

As Senators are aware, the temporary wage subsidy scheme, TWSS, and the employment wage subsidy scheme have played a central role in supporting businesses, encouraging employment and helping maintain the link between employers and employees. Over €10 billion was paid under both schemes, with 67,000 employers availing of the TWSS and, to date, just under 52,000 employers availing of EWSS with respect to 739,500 employees. It is an extraordinary number when we consider how many people are at work in our country. Overall, this process has played a vital role in protecting and preserving our economy when it was under such direct challenge due to the economic consequences of Covid-19.

Section 3 of the Bill makes clear that the pandemic recognition payment of €1,000 to eligible front-line health and ambulance workers will be tax-free. This recognises the extraordinary efforts of those front-line workers in supporting our lives and health at a time of such difficulty.

This leads me to the Covid restrictions support scheme, CRSS, which was introduced in the Finance Act 2020, with €727 million paid under the scheme to businesses affected by public health restrictions. Section 4 gives a legislative basis for the final changes announced in response to the public health restrictions of last December. It provides for an increase in the turnover reduction criteria of no more than 25% of 2019 turnover to now no more than 40%. This was made available to newer businesses that commenced trading in the period between 13 October 2020 and 26 July 2021. In addition, certain charities and sporting bodies that carry on similar trading activities to businesses became eligible to apply for CRSS in the most recent period of restrictions.

Tax debt warehousing was introduced in 2020 by the Financial Provisions (Covid-19) (No. 2) Act 2020. At the end of March, more than 90,000 individual businesses were availing of debt warehousing, with €2.9 billion of liabilities warehoused. To put this in context, the total debt eligible is €30.9 billion; 90% of that debt has been paid and the amount warehoused represents approximately 10% of the total tax debt eligible for the scheme. As announced last January, the Government has agreed that the period when tax liabilities arising can be warehoused will be extended to 30 April 2022 for all businesses eligible for Covid-19 support schemes. This will allow businesses that have been most affected additional time to recover before their tax liabilities must be paid. Their period of zero interest will therefore commence from 1 May 2022 and last until 30 April 2023, with interest at the reduced rate of 3% payable thereafter until the debt is paid down. This extension is provided for in sections 5 and 6 and 8 to 11, inclusive.

Section 12 deals with the changes to mineral oil tax to which I referred earlier. Section 13 deals with special exemption orders. In terms of the Government's response to the bulk purchasing of residential properties, section 14 makes an amendment to address a particular issue relating to social and affordable housing in the context of the 10% stamp duty measure. It is proposed to make provision for a partial repayment scheme for properties designated as cost-rental dwellings by the Minister for Housing, Local Government and Heritage under Part 3 of the Affordable Housing Act 2021. In practical terms, qualifying taxpayers will get a refund of the difference between the 10% rate and the normal stamp duty rate, which in most instances will be 1%. The beneficiaries of this amendment will be those involved in the delivery of cost-rental homes at scale, including approved housing bodies such as the Land Development Agency and local authorities.

The fishing fleet decommissioning scheme is dealt with in section 15.

Section 16 makes provision for the funding of the Central Bank's central mechanism for information on safe-deposit boxes and bank and payment accounts and in respect of the operation of the register of the beneficial ownership of central financial vehicles, which are required as part of the transposition of EU anti-money laundering directives.

The Bill provides a legislative basis for changes to various support schemes for businesses that were announced in December and January, as well as a number of additional matters I have outlined. It underlines the responsiveness of the Government to the needs of businesses for supports while also remaining conscious of the need to carefully manage and restore our public finances.