Gerald Nash (Louth, Labour)
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176. To ask the Minister for Finance the action Ireland has taken on foot of the European Commission recommendation of 14 July 2020 (C(2020) 4885 final) on making State financial support to undertakings conditional on the absence of links, up to the beneficial owner, to non-co-operative jurisdictions for tax purposes, so-called blacklist jurisdictions, pursuant to point 7 of the recommendation; the information he has already provided to the Commission regarding measures taken to implement the recommendation; and if he will make a statement on the matter. [27489/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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Ireland supports the EU list of non-cooperative tax jurisdictions which has proven to be a powerful tool to encourage countries around the world to implement globally agreed tax reform measures. Last year in Finance Act 2020 I introduced enhanced CFC (Controlled Foreign Company) Rules to apply to businesses in jurisdictions included in the EU list of harmful tax jurisdictions.

Ireland, like most countries, has introduced support schemes and attached various conditions to the eligibility for COVID-19 supports. Across a range of Government Departments a comprehensive package to help businesses and workers during the pandemic has been put in place, including the following operated by the Revenue Commissioners:- COVID-19 Restrictions Support Scheme (CRSS), the Temporary Wage Subsidy Scheme (TWSS), the Employment Wage Subsidy Scheme (EWSS) and debt warehousing of tax liabilities. I am not aware whether any companies receiving public supports in Ireland are registered in jurisdictions that are included on the EU list of non-cooperative tax jurisdictions.

The Covid Restrictions Support Scheme was introduced in Finance Act 2020 to support businesses significantly affected by restrictions introduced to combat the COVID-19 pandemic. The support is available to eligible businesses who carry on a business activity that is impacted by COVID-19 restrictions. The business must have been required to prohibit or considerably restrict customers from accessing their business premises. Generally, this refers to COVID-19 restrictions at Level 3, 4 or 5 as explained in the Government’s Plan for Living with COVID-19. Certain businesses may qualify for the support where lower levels of restrictions are in operation.

The CRSS is available to eligible businesses that carry on a trade or trading activities from a business premises, including companies, sole-traders or self-employed individuals, and partnerships.

To be eligible:

- the profits of the trade or trading activities of the business must be chargeable to Irish tax under Case I of Schedule D,

- the business premises must be located wholly within a geographical region for which Irish Government COVID-19 restrictions are in operation, and

- businesses must possess valid tax clearance to enter the CRSS and continue to maintain tax clearance for the duration of the scheme.

Further details are available on the Revenue website at: www.revenue.ie/en/self-assessment-and-self-employment/crss/qualifying-criteria-for-eligible-businesses.aspx.

The Temporary Wage Subsidy Scheme was legislated for in section 28 of the Emergency Measures in the Public Interest (Covid-19) Act 2020. The objective of the TWSS was to keep an employee on his or her employer’s payroll and to provide support to keep the employee’s income at a level close to his or her normal average wage. The TWSS was only available to employers registered in Ireland whose business activities were adversely impacted by the COVID-19 pandemic and applied as regards employees who were on the employer's Irish payroll at 29 February 2020. The scheme applies to businesses (companies, partnerships, individuals) resident for tax purposes in the State and also to non-resident companies that carry on a trade in the State through an Irish branch.

A non-resident company that carries on a trade in the State through an Irish branch is chargeable to Irish corporation tax on trading profits and other income relating to the Irish branch. I am advised by Revenue that aggregate information in relation to wage subsidy payments made to this category of employer – companies that are not tax resident in the State but are trading here through an Irish branch – is not available. However, in accordance with section 28 of the Emergency Measures in the Public Interest (Covid-19) Act 2020, the names and addresses of all employers to whom a temporary wage subsidy has been paid by Revenue is published on its website and available at: www.revenue.ie/en/employing-people/twss/list-of-employers/index.aspx.

As part of the “July Stimulus” announced on 23 July last, the Government introduced the Employment Wage Subsidy Scheme (EWSS). The EWSS was legislated for under the Financial Provisions (Covid-19) (No. 2) Act 2020 which was signed into law on 1 August 2020. It replaced the Temporary Wage Subsidy Scheme from 1 September 2020. The EWSS delivers an enterprise support to employers based on business eligibility delivering a per-head subsidy on a flat rate basis.

As is the case with the TWSS, the EWSS applies to businesses (companies, partnerships, individuals) resident for tax purposes in the State and also to non-resident companies that carry on a trade in the State through an Irish branch. No aggregate information in relation to companies that are not tax resident in the State but are trading here through an Irish branch is available in relation to the EWSS. However, the names and addresses of all employers to whom the EWSS has been paid by Revenue is periodically published on its website at: www.revenue.ie/en/employing-people/ewss/list-of-employers-who-received-payments-under-the-ewss.aspx. Additionally, and unlike the TWSS, the employer must have a tax clearance certificate to be eligible to join the EWSS and must continue to meet the requirements for tax clearance throughout the scheme.

I am advised by Revenue that the debt warehousing scheme provides for reduced interest on certain tax liabilities which businesses were unable to pay as a result of the Covid-19 crisis, namely VAT, PAYE (Employer), Income Tax and excess TWSS. These supports are only available to Irish taxpayers. For all taxes in the scheme, a taxpayer must continue to file all returns and pay its other tax liabilities. The condition for eligibility for warehousing VAT, PAYE (Employer) and excess TWSS debts is that the business must have been adversely affected by restrictions to combat the spread of Covid-19, such that it cannot pay its liabilities. The condition for eligibility for warehousing Income Tax liabilities is that the individual’s income for 2020 must have been reduced by at least 25% compared to his/her income for 2019, as a result of the impact on his/her income of the Covid-19 restrictions and he or she is therefore unable to pay those liabilities. Further details on the warehousing of tax debts are available from the Revenue website at:

www.revenue.ie/en/corporate/communications/covid19/filing-and-paying.aspx.

I am also aware that the Department for Enterprise, Trade, and Employment provides other supports including the COVID-19 Credit Guarantee Scheme (CCGS) which makes up to €2 billion in lending available for Irish businesses and is the largest guarantee scheme in the history of the State. Its function is to add certainty to businesses that funding is available for working capital and investment purposes. Loans of up to €1 million are available for up to five and a half years at reduced interest rates. Loans under €250,000 do not require collateral or personal guarantees. The Scheme is available to SMEs and small mid-caps (including primary producers) and will run until 31 December 2021 in accordance with the European Commission's State Aid Temporary Framework implemented in response to COVID-19.