From Department of Finance; Department of Public Expenditure, NDP Delivery and Reform
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An Exchequer deficit of €7,438 million was recorded to end-October. This compares to a deficit of €11,681 million in the same period last year, a €4,243 million improvement driven by a recovery in taxation receipts .
Corporation tax receipts in October were very strong, with €1,494 million received, €964 million higher than profiled. Just under €300 million of corporation tax receipts relate to tax settlements. Much of the remainder is due to larger-than-profiled payments from the life sciences sector. It is not expected that such a high level of receipts will be repeated in future years. At €2,223 million, income tax receipts continue to be robust and were €330 million, or 17.4 per cent higher than profiled in October and €639 million or 40.3 per cent higher in year-on-year terms.
The recovery in excise duties to-date has been less pronounced than VAT, with receipts of €546 million in line with target in October and up by €38 million, or 7.6 per cent on the same month last year. October is not a VAT-due month; receipts in this area amounted to €169 million.
Total gross voted expenditure to end-October 2021 amounted to €67,527 million. This is €1,979 million
or 3 per cent ahead on the same period in 2020 and €2,447 million, or 3.5 per cent below profile. The underspend vis-a-vis profile is the result of a number of factors including the closure of construction sites earlier in the year.
Commenting on the figures, the Minister for Finance, Paschal Donohoe T.D. said:
“Corporation tax receipts in October were higher than expected, once again illustrating the inherent unpredictability and volatility of this revenue stream. Despite the further clarity that now exists with international tax reform, there is still a high level of uncertainty in relation to its impact on Ireland.
The best form of defense against any negative impact is to have strong and stable public finances. Budget 2022 set a framework within which we can reduce the deficit and restore the public finances, while continuing to invest heavily in public services, particularly in capital infrastructure.”
The Minister for Public Expenditure and Reform, Michael McGrath T.D. said:
“Gross voted expenditure at the end of October totaled over €67½ billion, almost €2 billion ahead of expenditure levels for the same period last year. Current expenditure stands at almost €62½ billion, with nearly 82 per cent of this, some €51.1 billion, relating to spending in the Departments of Education, Social Protection, Health, and Further and Higher Education, Research, Innovation and Science. This reflects the Government’s continued focus on protecting the most vulnerable in society and prioritising core social services against the impacts of Covid-19.
Building on this, Budget 2022 was prepared in line with the medium term fiscal strategy set out in July’s Summer Economic Statement and reflects the Government’s commitment to return the public finances to a more sustainable position whilst also continuing to enhance our public services and social supports in a fiscally viable manner. The process of carefully unwinding funding provided for exceptional measures related to Covid-19 in a phased basis was also set out. Adopting this approach will ensure the continuation of appropriate support measures next year in response to Covid-19 as our society and economy continue to recover from the impact of the virus.”
ENDS
Notes to editors: