Irish Tax Take Grows Along With Resurgent Economy

by Jason Gorringe, Tax-News.com, London

16 December 2014

Finance Minister Michael Noonan has said that strong income tax and value-added tax receipts are evidence of the Irish economy's recovery.

The Irish economy is on track to post a growth rate of about 3.5 percent of gross domestic product (GDP) for this calendar year. With a strengthening economy, tax revenues worth EUR38.2bn were collected during the eleven months to the end of November, an increase of 8.5 percent against the same period in 2013. Income tax rose by 8.9 percent year-on-year, and VAT receipts were up 5.6 percent.

However, while growth was strong in the early part of the year, the economy experienced stagnant growth in the third quarter. Noonan said: "The recovery should not be taken for granted and there are risks." He explained that his 2015 Budget was "designed to strengthen and broaden this recovery, and targeted measures were introduced to boost key sectors of the economy including tourism, agriculture, construction, and foreign direct investment."

"Budget 2015 was also the first year of this Government's strategy to reduce income tax and [the] Universal Social Charge (USC), and every worker paying tax or USC will start to see an increase in their take home pay in 2015. This is designed to boost consumer confidence and demand and will further improve Ireland's competitiveness and attractiveness as a destination for investment and job creation," he said.

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