A SURGE IN Corporation Tax receipts left the Exchequer with a surplus of just over €100 million in 2018.
According to figures released by the Department of Finance today, the Exchequer received more than €55.5 billion last year. This is nearly €1.4 billion (2.6%) more than forecast and over €4.2 billion more than last year.
The surprisingly high end-of-year returns were largely due to €10.4 billion in Corporation tax being taken in.
The business tax generated €1.9 billion (22%) more than the Government expected. It is now the State’s third largest tax category.
Vat, Capital Gains Tax and Capital Acquisitions Tax also collected more than was forecast.
However, it wasn’t all good news, Income Tax was €203m (0.9%) behind expectations with €21.2 billion collected and Stamp Duty was €217m (13%) short with €1.45 billion.
It’s the first year the government has recorded a surplus since 2006.
Speaking about the figures the Minister for Finance and Public Expenditure & Reform, Paschal Donohoe said: “All major tax heads, except excise duties, are up year-on-year, reflecting the growing strength of the economy, while expenditure remains close to Budget day expectations.
This means that we are on track to exceed our fiscal targets for 2018, with today’s figures recording a small surplus.
The returns were welcomed by Ibec but the business group said that had it not been for the unexpected surge in corporate tax the Government would still be running a deficit and would be spending €5.3 billion more than it is bringing in.
“To date, much of the volatility in corporation tax receipts was positive, but were it to move in the other direction, government finances would be left very exposed as most of this unexpected revenue was used to finance unplanned supplementary estimates,” Ibec Economist Alison Wrynn said.
Any future surge in resources should be ring-fenced for one off capital projects as opposed to day to day spending.
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