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Small Firms Association wants easier conditions for companies repaying inventory taxes

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The Small Firms Association (SFA) is seeking easier payback terms for small businesses that have been storing their tax debts during the pandemic and are now facing tough trading conditions.

The lobby group is writing to Tánaiste Leo Varadkar and Finance Minister Paschal Donohoe this week, demanding longer fixed repayment terms and 0 percent interest on parked tax arrears, as well as a “tailored engagement” between the tax office and struggling companies.

The SFA said that although small businesses resumed trading after the pandemic, the cost of doing business rose “at an alarming rate” while the crisis in Ukraine increased pricing pressures on the sector.

“It’s a bit like a perfect storm,” said SFA director Sven Spollen-Behrens. “It’s a challenging time for small businesses with all the cost pressures and wage demands and some sectors are still badly affected [by the Covid-19 emergency].”

Mr Spollen-Behrens said there was “no one-size-fits-all solution” to small businesses’ liquidity problems, but making it easier for SMEs to pay off tax debts that have built up over the past two years should be an option.

“What we charge is not expensive,” he said.

A total of €3.2 billion in tax liabilities were “parked” during the Covid emergency, out of a total of €30.9 billion eligible for the revenue warehousing scheme, meaning 90 percent of businesses are paid.

According to statistics released by Revenue last week, 36 percent of companies with tax debts stored have already paid off part of their arrears, leaving €2.7 billion owed.

The program was used by 105,000 companies.

Businesses can leave their debt parked with no interest accruing until April 30, 2023, after which it will accrue 3 percent interest for the duration of the payment plan. Interest on tax debts is usually 8 to 10 percent.

The SFA wants the 0 percent interest rate to be extended to the entire term and calls for fixed repayment periods of up to three years in order to harmonize the treatment of all companies.

Tax officials have contacted all companies in the camp system to let them know how much they owe and if any of their declarations are missing.

Those not up to date will have to file outstanding returns by the end of the month or face an immediate repayment request, Revenue says.​​​​​

https://www.independent.ie/business/small-business/small-firms-association-wants-easier-terms-for-firms-repaying-warehoused-taxes-41528041.html Small Firms Association wants easier conditions for companies repaying inventory taxes

Fry Electronics Team

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