From Department of Finance; Department of Public Expenditure, NDP Delivery and Reform
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Tax receipts amounted to €66.5 billion in the first ten months of the year, up by €2½ billion (4 per cent) on the same period last year. Steady growth in income tax and VAT receipts taxes offset a decline in corporation tax receipts.
At €25.7 billion to end-October, income tax receipts remain comfortably ahead of last year, by €1.8 billion (just over 7½ per cent), reflecting the strength of employment. Annual growth in October was more modest, however, with receipts up by 2.4 per cent on the same month last year.
VAT receipts to end-October amounted to €17.0 billion, €1.6 billion (10 per cent) ahead of the same period last year. October is not a VAT-due month, with receipts of just €0.2 billion.
Corporation tax receipts in October were €1.0 billion (45 per cent) below the level in the same month last year. This is the third successive month in which receipts were behind the corresponding month of last year.
This means that cumulative corporation tax receipts of €15.7 billion in the first ten months of the year are €0.4 billion (2.7 per cent) below their level in the same period last year. This reflects the weakening of exports over the past year and, in particular, the decline in pharmaceutical exports.
Total gross voted expenditure to end-October amounted to €72.2 billion, up by €5.6 billion or 8.5 per cent on 2022 and €0.2 billion or 0.3 per cent behind of profile.
An Exchequer deficit of €0.9 billion was recorded to end-October, a decline of over €8 billion on the surplus recorded in the same period last year, driven by a number of factors including increased public expenditure, reduced non-tax revenue and the transfer earlier this year of €4 billion to the National Reserve Fund.
Commenting on the figures, the Minister for Finance Michael McGrath said:
“The end-October Exchequer returns present a mixed picture of our public finances. While income tax and VAT remain steady, demonstrating the underlying strength of our economy, we have now seen corporation tax decline for a third consecutive month.
“A fundamental building block of the government’s fiscal strategy is the assumption that a large part of the increase in corporation tax receipts in recent years is windfall in nature.
“This is why it is so important that permanent fiscal commitments are not made on the basis of windfall revenues; instead, running a budgetary surplus is the correct approach.
“It is also why, in Budget 2024, I announced the establishment of two new long-term investment funds – the Future Ireland Fund and the Infrastructure Climate and Nature Fund – that will allow us to invest temporary ‘windfall’ corporation tax receipts to provide resources for known future fiscal challenges and ensure that these receipts do not become part of the permanent expenditure base.
"I am working with my officials to progress the necessary legislation and this is a key priority for the government in the year ahead.”
The Minister for Public Expenditure, NDP Delivery and Reform, Paschal Donohoe, said:
“Today’s figures highlight government investment of over €72 billion to date in 2023. When compared to the same period in 2022, this is an increase of 8.5 per cent. This money is being utilised to provide key supports to our public services, supporting living standards and investing in infrastructure. Capital Expenditure has increased year-on-year by c.30 per cent or €1.6 billion, reflecting progress in the rollout of the National Development Plan.
"The government’s planned and balanced approach to fiscal policy has allowed us to manage these priorities while providing supports for those who most need it in the face of emerging external challenges. This includes over €1.8 billion for our domestic humanitarian support for Ukrainian arrivals. These figures reflect substantial additional resources provided to DCEDIY for accommodation support.”