Sunday 23 October 2016

Exchequer deficit falls: Ireland on target to meet European budget rules ahead of schedule

Published 05/08/2015 | 16:36

Finance Minister Michael Noonan
Finance Minister Michael Noonan

The closely watched Exchequer deficit has fallen to €647.515m for the first seven months of the year, marking a radial improvement in the State’s finances.

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It means the country is well on target to meet European budget rules without any new taxes and ahead of schedule, despite the latest Irish Water debacle.

The deficit figure measures the difference between public spending and what the Government takes in through taxes and other income, and is seen as a key gage of financial sustainability. 

In the seven month period to the end of July the deficit fell to €647.5m –or around €92m a month.

That is radically lower than the €5.18bn overspend in the same period last year, which worked out at €738m a month.

The Government borrows to meet the shortfall, so cutting the deficit is an important target and crucial in helping lower the national debt.

The latest data shows overall tax receipts this year are around 10pc up on last year, and 3.8pc higher than the Government’s own forecasts.

Tax income is up generally across the board, but the new figures show an especially sharp rise of 36.7pc in the amount of corporate tax, which is levied on business profits, being paid.

Corporate tax income of €2.9bn in the first seven months of the year is €778m ahead of last year’s  level.

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