Corporate Revenues Boost Irish Tax Take

by Jason Gorringe, Tax-News.com, London

06 July 2006

Irish Finance Minister Brian Cowen announced Tuesday that the government collected almost EUR1 billion ($1.3 billion) more in tax than expected in the first six months of this year, thanks to higher corporate tax receipts and stamp duty revenues.

Total current receipts in the first six months amounted to EUR19,890 million compared to receipts of EUR17,520 million for the same period in 2005, an increase of 13.5 per cent.

Tax revenue, at EUR19,587 million, is EUR980 million ahead of profile at end-June. Year on year tax receipts were up 13.6 per cent compared to an expected increase of 7.9 per cent to end June 2006.

The best performers were corporation tax (up EUR337m), stamp duties (EUR332m) and capital taxes (EUR252m).

All other taxes were also above estimates, with the exception of income tax which is EUR41m below target.

An Exchequer surplus of EUR880 million was recorded in the second quarter of 2006. This compares to an Exchequer deficit of EUR594 million for the second quarter of 2005 and a budgeted deficit of EUR2,927 million for 2006 as a whole.

Cowen commented that the figures show how Ireland's public finances are in a "sound position".

"Tax revenues are performing well, and public expenditure growth is within the targets set for it. These and other factors have led to an Exchequer surplus of EUR880 million for the first six months," he observed.

However, the Finance Minister cautioned that the government must remain "vigilant" by maintaining fiscal policies that support economic growth and competitiveness, while providing adequate funding for social and capital spending.

Recommended