Gerald Nash (Louth, Labour)
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68. To ask 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]

Michael McGrath (Cork South Central, Fianna Fail)
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The 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.

Gerald Nash (Louth, Labour)
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69. To ask the Minister for Finance the amount of dividend withholding tax paid by REITs in 2020, 2021 and 2022, respectively; the amount of personal income tax paid on the dividends from REITs; and if he will make a statement on the matter. [19797/23]

Gerald Nash (Louth, Labour)
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70. To ask the Minister for Finance the amount that was paid out as dividends by REITS in 2020, 2021 and 2022, respectively. [19798/23]

Gerald Nash (Louth, Labour)
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71. To ask the Minister for Finance the expected additional yield in 2023 if the rate of dividend withholding tax levied on REITs was increased to 33%, or 50%, respectively; and if he will make a statement on the matter. [19799/23]

Michael McGrath (Cork South Central, Fianna Fail)
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I propose to take Questions Nos. 69 to 71, inclusive, together.

In relation to Dáil Question No. 69 (Ref: 19797/23) and Dáil Question No. 70 (Ref: 19798/23), the Deputy may be aware that there is now only one REIT remaining in the Irish market. As a result, I am advised by Revenue that, due to Revenue’s obligation to maintain the confidentiality of taxpayer information, the specific quantitative information requested by the Deputy cannot be provided. I would however note that REITs are required to be publicly traded entities, and as a result a large volume of information is publicly available, for example in the form of published annual reports.

In relation to Dáil Question No. 69 (Ref: 19797/23), irrespective of the confidentiality constraints arising due to the small number of entities, it would not be possible to provide details of the amount of personal income tax paid on the dividends from REITs as this would be affected by a number of factors distinct to each individual taxpayer, such as their total income from all sources and available tax bands and tax credits.

In relation to Dáil Question No. 71 (Ref: 19799/23), and again irrespective of the restrictions on the provision of information due to the small number of entities, it would not be possible to provide the information sought as the yield from changes in the rates of withholding taxes on REITs would be dependent on the level of future distributions by these entities. There is no basis available to provide an accurate estimate of these future distributions. Furthermore, investors resident in treaty-partner countries may be able to reclaim some of the REIT DWT deducted, by reference to an agreed distribution rate in the relevant bi-lateral treaty. In such cases, there would be no net Exchequer yield from an increase in the withholding tax rates as treaty relief would reduce the net tax back to the existing agreed treaty rate.

Gerald Nash (Louth, Labour)
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72. To ask the Minister for Finance the methodology for determining what portion of corporation tax returns can be described as windfall; if he intends to commission an independent study of this to determine the prospects for future returns and what level may be one-off; and if he will make a statement on the matter. [19800/23]

Michael McGrath (Cork South Central, Fianna Fail)
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Last year as part of Budget 2023, my Department published an analysis entitled De-risking the Public Finances – Assessing Corporation Tax Receipts. This paper outlined a range of methodologies for estimating ‘windfall’ corporation tax receipts i.e. the amount that cannot be explained by underlying drivers and, therefore, may be more vulnerable to a shock. In general terms, the Department’s approach utilises scenario analysis, which inter alialinks corporation tax revenue trends to historical norms and to domestic economic variables, to assess the extent of any potential windfall.

Based on this approach, the analysis concluded that somewhere in the region of €4 to €6 billion in receipts in 2021 were potentially transient in nature. It is important to stress that, in practice, the impact could be even larger, in particular, if there were spillovers to other tax revenue streams such as income tax.

Given the higher-than-expected outturn last year, the estimate for 2023 has been revised as part of the Stability Programme Update published earlier this month. As a result of this analysis, my Department now estimates that almost €12 billion in corporation tax are ‘windfall’ in nature. This represents a clear vulnerability in our public finances, with an underlying general government deficit of €1.8 billion this year in prospect if these receipts are excluded.

In addition to the work undertaken by my Department, other bodies have carried out similar analysis of previous year’s receipts: both the Central Bank and the Irish Fiscal Advisory Council have published independent estimates of windfall corporation tax in recent years.