Jackie Cahill (Tipperary, Fianna Fail)
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48. To ask the Minister for Finance his plans for the continuation of VAT and PAYE warehousing for the hospitality sector; and if he will make a statement on the matter. [4785/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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The Debt Warehousing Scheme remains available to support businesses, including the hospitality sector, experiencing tax payment difficulties arising from the current COVID-19 public health restrictions. Currently, there are approximately 70,000 businesses availing of the scheme covering €1.9 billion in tax debt.An information leaflet is available on Revenue’s website at .

The scheme was expanded in Budget 2021 to include certain self-assessed income tax liabilities (balance of 2019 Income Tax liability and 2020 preliminary tax) and Temporary Wage Subsidy Scheme (TWSS) overpayments in addition to PAYE (Employer) and VAT tax debts that have arisen due to the COVID-19 crisis.

Under the scheme, these debts can be ‘parked’ on an interest free basis for 12 months following resumption of trading. At the end of the 12-month interest free period, the warehoused debt may be paid in full without incurring an interest charge or paid through a phased payment arrangement at a significantly reduced interest rate of 3% per annum. This compares to the standard rate of 10% per annum that would otherwise apply to such debts.

Any business, including those operating in the hospitality sector, experiencing trading difficulties as a result of COVID-19 restrictions can avail of the scheme whether it had done so during the previous period(s) of trading restrictions or not. Businesses that previously availed of the scheme, and subsequently resumed trading and paying their tax debts as they arose, can recommence using the scheme if their trade has again been impacted by the current restrictions, which will remain in place until 5 March 2020. The warehousing facility remains available to eligible businesses for at least two months after resuming trading, for example a business that resumes trading in March 2021 can continue to warehouse VAT and PAYE (employer) liabilities until June 2021.

Eligibility for the scheme remains the same in that access is automatic for SMEs and on request for larger businesses. It also remains a requirement that businesses continue to file all relevant tax returns for the restricted trading period(s) so that the tax debt can be quantified and included in the scheme.

Finally, Revenue has confirmed that it is in the process of writing directly to businesses availing of debt warehousing to confirm that the scheme remains available for those that have had to close or continue to be significantly negatively impacted by the current COVID-19 related restrictions.

Jackie Cahill (Tipperary, Fianna Fail)
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49. To ask the Minister for Finance his plans to support the hospitality sector in getting the insurance sector to pay compensation for business interruption as a result of Covid-19; and if he will make a statement on the matter. [4786/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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At the outset it is important to note that working to protect customers during and after the COVID-19 crisis is a priority issue given its inclusion in the Programme for Government. As such, business disruption insurance is specifically included within the Action Plan for Insurance Reform, launched last month. I am in full understanding of the concerns expressed about how the insurance industry is responding to the needs of its business policyholders in these difficult times, including honouring business interruption claims. Whether a company is able to successfully claim on its business interruption policy due to a COVID-19 enforced closure will depend on the specific policy. This is ultimately a matter of contract law between the business and its insurer. While this is an issue that Minister of State Fleming and I continue to follow closely, it should be noted that neither we, nor the Central Bank of Ireland (CBI), can direct or require that insurers cover claims, including those resulting from infectious diseases such as COVID-19, nor can we adjudicate on the validity of such claims.

The above said, we both have had a number of engagements with the insurance industry on this issue, and have made it very clear that insurers should not attempt to reject claims on the basis of interpreting policies to their own advantage. They should engage with those impacted businesses honestly, fairly and professionally to honour those elements of the policies covered, in line with the CBI’s Consumer Protection Code. Minister of State Fleming reiterated this expectation to the main insurers in the Irish market during his engagements with them late last year.

Separately, the CBI’s COVID-19 Business Interruption Supervisory Frameworksets out its expectations of insurance firms in handling related insurance claims. The objective of the Framework is to seek early identification and resolution of issues which have the potential to cause customer harm and bring clarity to affected businesses as quickly as possible.Significantly, in my view, where cover and related issues are disputed, the CBI expects firms to pay the reasonable costs of customer plaintiffs in agreed test case litigation. On that point, I would note that a number of related test cases are before the High Court, with judgments due to be handed down next week. Accordingly, it would be inappropriate for me, or the Government to provide comment on these at this stage.

In conclusion, the Deputy should be assured that Minister of State Fleming and I will continue to monitor the business interruption issue and will engage appropriately with both insurers and the Central Bank of Ireland on the matter.