Mayo businesses 'grappling with debt and rising costs'

A lot of Mayo businesses are grappling with the dual pressures of escalating debt and the rising cost of living - compounded by the inflationary environment.

That's the assertion of Mayo TD Alan Dillon.

He stated: "We need to ensure that Revenue and the county sheriffs are collaboratively working together and demonstrating compassion with individuals and businesses that are impacted by this.

"It is paramount that we continue to develop strategies to support those who find themselves in challenging circumstances.

"I welcome the flexible payment arrangements. That is important, particularly in light of the cost-of-living issues and the ongoing challenges people face.

"We must stand alongside our local businesses and ensure they can maintain their presence in our towns and villages and that they support employment.

"I ask that the government continues to assist companies that might struggle in this process."

In response, Finance Minister Michael McGrath said the debt warehousing scheme allows for the deferral of the payment of VAT, PAYE and certain self-assessed income tax liabilities, including the temporary wage subsidy scheme, TWSS, and employment wage subsidy scheme, EWSS, overpayments.

He said: "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 energy crisis.

"As of the end of March 2023, the value of debt warehoused was €2.216 billion for 63,600 businesses.

"Of this total: some 31% have warehoused debts of less than €100; some 15% have warehoused debts of between €101 and €1,000; and a further 19% have warehoused debts between €1,001 and €5,000.

"In total, 41,294 businesses in the warehouse - 65% of the total - have an outstanding balance of less than €5,000.

"The bulk of the debt figure is warehoused by just 6,462 customers, with outstanding balances greater than €50,000 totalling almost €1.9 billion of the overall figure of €2.2 billion.

"Last October, the Revenue Commissioners announced an extension to the period during which debts can remain parked in the warehouse.

"This means that businesses no longer have the challenge of making arrangements to repay their warehoused debt until May 1, 2024.

"This significant additional time should greatly support businesses in their recovery from the impacts of the pandemic and the energy crisis and prevent business failure."