Connect with us


Record corporate tax haul brightens Irish public finances

Record corporate tax haul brightens Irish public finances 1

By Padraic Halpin

DUBLIN (Reuters) – Ireland collected 9.4%, or 5.4 billion euros ($6 billion), more tax than expected in the first 11 months after it took in a record amount of corporate tax in November, traditionally the most buoyant period of the year.

Tax revenues proved extremely resilient during the worst of the COVID-19 pandemic in 2020 and have taken off this year despite the economy being in its third and longest lockdown for much of the first half.

The finance ministry took in 1.5 billion euros more that it had budgeted for last month alone, it said on Thursday.

It also collected 4 billion euros in corporate tax versus the 3.2 billion expected, putting Ireland on course for another record annual haul with corporate receipts making up more than one in every five euros of tax collected.

That also meant corporate receipts for November were greater than the annual corporate tax take ten years ago, when the state took in 3.8 billion euros.

While global corporate tax reforms are forecast to slow the recent rapid growth in a category dominated by foreign multinationals, they were 26% ahead of target during the first 11 months of the year at 13.6 billion euros.

Finance Minister Paschal Donohoe said the outturn reflected the very robust performance of the technology sector during the pandemic and that the receipts across the board were another positive indicator of the strength of Ireland’s economic recovery.

VAT receipts were 7.2% above forecast year to date at the end of November while income tax, the largest category, was 4.3% ahead of target after both also enjoyed a bumper month.

With spending 3.4% below forecast, the exchequer recorded a narrower deficit of 4.9 billion euros on a 12-month rolling basis.

The government forecast last month that it would run a 2021 budget deficit of 5.9% of modified gross national income, down from 8.8% last year.

While Ireland’s fiscal watchdog predicted this week that the deficit would be lower than that by year end, Donohoe told Reuters on Wednesday that the new Omicron COVID-19 variant made December too uncertain to call.

($1 = 0.8837 euros)

(Reporting by Padraic Halpin; Editing by Emelia Sithole-Matarise)

Editorial & Advertiser disclosure
Our website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.
Global Banking and Finance Review Awards Nominations 2022
2022 Awards now open. Click Here to Nominate


Newsletters with Secrets & Analysis. Subscribe Now