Most taxes steady in first half of the year but corporation tax volatile; continued investment in public services and infrastructure – Ministers Donohoe & Chambers
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From: Department of Finance; Department of Public Expenditure, Infrastructure, Public Service Reform and Digitalisation
- Published on: 3 July 2025
- Last updated on: 4 July 2025
- today’s Exchequer returns show that tax revenues (exc. CJEU payments) in the first half of the year amounted to €47.7 billion, €3 billion (6.7 per cent) ahead of the same period last year
- income tax receipts of €17.4 billion are ahead of last year by €0.7 billion (4.3 per cent)
- VAT receipts of €11.6 billion are up on last year by €0.6 billion (5.8 per cent)
- corporation tax receipts (excluding CJEU payments) of €13.1 billion are up by €0.9 billion (7.4 per cent) relative to the same period last year
- total gross voted expenditure in the first half of the year amounted to €50.9 billion, up by €3.8 billion (8.2 per cent) on 2024 and ahead of profile by €0.3 billion (0.7per cent)
- excluding CJEU receipts, an underlying Exchequer surplus of €1.2 billion was recorded to end-June, compared with a surplus of €3.1 billion in the first half of last year
Tax receipts of €49.5 billion were collected in the first six months of the year, up by €4.7 billion (10.5 per cent) on the first half of last year; this was ahead of profile by €0.5 billion (1 per cent) with the overshooting largely due to corporation tax receipts.
When once-off tax revenues arising from the CJEU ruling of September 10th 2024 of €1.7 billion are excluded, ‘underlying’ tax revenues stood at €47.7 billion, which was a €3 billion (6.7 per cent) increase on last year.
Income tax receipts in June were €2.9 billion, up on last year by €0.1 billion (2.9 per cent). On a cumulative basis, income tax receipts of €17.4 billion are ahead of last year by €0.7 billion (4.3 per cent) and broadly in line (behind by 0.7 per cent) with the department's expectations.
June is a non-VAT-due month and receipts of €0.2 billion were accordingly relatively modest. Cumulative VAT receipts of €11.6 billion are up on last year by €0.6 billion (5.8 per cent) and largely in line (0.8 per cent behind) profiled receipts.
June is a key month for corporation tax payments and receipts of €7.4 billion were €1.5 billion higher than in June of last year. This follows a decline of €1.1 billion seen last month, underscoring the exceptional volatility – in both directions – in this revenue stream. Cumulative corporation tax receipts (excluding CJEU payments) of €13.1 billion are now ahead of last year by €0.9 billion (7.4 per cent), and slightly ahead of profile (2.3 per cent).
Non-tax revenue in the first half was €2.2 billion, up by €1.9 billion on the first half of last year, primarily driven by transfers to the Exchequer arising from the CJEU judgement (mainly interest payments).
Total gross voted expenditure in the first half of the year amounted to €50.9 billion, up by €3.8 billion (8.2 per cent) on 2024 and ahead of profile by €0.3 billion (0.7per cent). Year-on-year capital spending levels have increased substantially, with capital spending up 22.5% overall.
At a headline level, an Exchequer surplus of €4.5 billion was recorded in the first half of the year. This compares to a surplus of €3.1 billion last year, an improvement of €1.4 billion.
Excluding the once-off CJEU receipts, the underlying surplus was €1.2 billion, €1.9 billion behind the same period last year.
Minister for Finance Paschal Donohoe said:
“June is a key month for tax receipts. The steady performance across most revenue streams in the first half of the year is a positive sign of the strength of our economy as we navigate a deeply uncertain period.
“Corporation tax receipts in June have seen a sharp increase, which follows a sharp decline last month. This serves as a reminder of the extreme volatility in this revenue stream, and of its inherent unsuitability as a basis for permanent spending commitments.
“That is why we have established the Future Ireland Fund and the Infrastructure, Climate and Nature Fund to set aside some of this potentially temporary revenue to help further protect us in the future. Last month, Government transferred some €3 billion into the two funds, and when the remaining transfers are made towards the end of this year, there will be around €16 billion in the FIF and ICNF.
“We have also committed to investing the once-off proceeds from the Court of Justice of the European Union ruling in the critical areas of housing, water, energy and transport – these are the strategically important areas that will underpin economic growth into the future.
“As we draft the fiscal parameters for Budget 2026 and beyond, we will ensure that we approach it in a sustainable way, with an approach that protects our economy, supports and protects jobs, underpins our ability to invest in public services and keeps our public finances safe.”
The Minister for Public Expenditure, Infrastructure, Public Service Reform and Digitalisation, Jack Chambers said:
“This government takes a deliberate and planned approach to public spending that is focused on delivering our economic, social and climate ambitions – protecting our economy and enhancing the living standards for our people.
“The increased investment in the first half of 2025 reflects the delivery of the priorities we set in the Budget, such as increases in weekly welfare payment rates, and continued investment in our front-line public service through the provision of additional teaching, nursing and garda posts.
“We will shortly be publishing our new Medium-Term Plan. Alongside this, my department will also be publishing a Medium-Term Expenditure Framework and a key input to the plan will be the finalisation of the review of the National Development Plan.
“Today’s figures show a significant increase in capital expenditure which underscores government commitment to investing in the infrastructure our community needs and which is critical to enhancing our economic competitiveness. The NDP review provides an opportunity to signal even greater investment in critical infrastructure to support our future growth and the continued development of business across the country.
“Last week I brought a Memo to Government on this to reaffirm the importance of ensuring taxpayers’ money is protected and our country is in a good position.
“Tax revenues are strong. As we prepare for Budget 2026, we need to carefully manage expenditure in the second half of the year, while continuing to commit the necessary resources to improve our public services, support our people and enhance quality of life across our country.”