The Government has written to hundreds of local businesses to demand that they repay taxes and contributions deferred as part of a pandemic relief effort, with the total outstanding sitting at more than £10m, it has emerged.
More than 800 businesses are still yet to settle their GST and Social Security bills.
At the height of the pandemic, 216 businesses took advantage of an initiative to defer their GST payments, totalling £4.9 million.
But following a question from Deputy Inna Gardiner to the Treasury Minister this week, it’s now emerged that less than half of the sum has been paid back.
By the end of 2024, 163 businesses still owed a combined £2.6 million.
The figures for deferred Social Security payments are even higher, the Social Security Minister revealed in response to another request by Deputy Garidner.
In 2020 and 2021, 1,400 businesses deferred a total of £16.7m in Class 1 Social Security contributions.
By the end of 2024, 823 businesses still owed a combined £7.7 million.
Last month, the Government contacted all businesses with outstanding deferred GST and Social Security payments, informing them that the amounts were now due.
Businesses unable to meet the repayments were advised to liaise with the Debt Collection Team to arrange a payment plan, both Ministers said.
It comes after it was revealed in November that around £5m in overclaimed covid financial support via the Co-funded Payroll Scheme remained unrecovered.
Alongside other support measures, the Government also introduced the Disruption Loan Guarantee Scheme to help businesses through the worst of the public health crisis.
This allowed the Government to guarantee loans issued by banks. The scheme ended on 31 December 2021, meaning no new applications or guarantees have been granted since then.
By the end of 2021, 169 businesses had enquired about the scheme, with 70 progressing to secure a facility.
A total of £4.3m in loans were approved, with 26 facilities with a total value of £1.1m remaining active by the end of 2024. Much has been repaid over time, and the Government’s guarantee exposure stood at £400,000 at the end of last year, a recently published Treasury report said.
To date, three confirmed loan defaults have resulted in claims by banks, the report revealed.
“The first, in 2021, amounted to £28,000 and was paid in January 2022. Two further defaults in 2023, valued at £28,000 and £411,000, were settled by the Government in September 2023 and January 2024, respectively,” it said.