Irish Tax Receipts Further Below Target Than Previously Thought

by Jason Gorringe, Tax-News.com, London

07 May 2002

The Irish government's books are in worse shape than previously thought, according to figures released last week.

Department of Finance figures for tax receipts to April 30 are 145 million euros below what the Exchequer took during the same period in 2001, and spending is rising even faster than predicted in Finance Minister, Charlie McCreevy's budget, making a larger than predicted deficit by the end of the year almost a certainty.

As the Irish Independent pointed out on Friday, this also means that the election manifesto calculations of the main political parties are based on over-optimistic forecasts which will need to be revised, and whichever party is successful in the May 17 general election will need to make some tough decisions.

The newspaper reported that Mr McCreevy built his Budget on a forecast rise of 8% in overall tax receipts. However, economists argue that with skyrocketing spending and declining income tax collection, there is almost no possibility that the economy will improve to the point where this can be achieved.

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