Exchequer Returns up after corporation tax boost
Published 02/02/2012 | 16:25
THE JANUARY tax take was €3.6bn, boosted by a once-off late payment of corporation tax, the first Exchequer Returns for 2012 show.
But even if the once-off payment was stripped out, the figures are strong - lifted by the Universal Service Charge (USC) and VAT.
Income tax, including the USC, was up 27.7pc to €1.26bn while VAT increased 3pc to €1.7bn.
January is generally the biggest month of the year for VAT receipts as they reflect the generally busy pre-Christmas period.
The total figure compares with €3.1bn in January 2011.
However, the figures only reflect one month’s payments while the Government’s tax take target for the year is €35.8bn compared with €34.1bn last year.
Excise duty, the last of the “big four” tax heads, increased by 2.7pc.
The Exchequer deficit in January 2012 was €394m compared with €483m for the same period last year.
The actual year-on-year increase in the cost of debt servicing was €286m.
Capital expenditure for the period was €210m, largely unchanged on the year.
The €250m corporation tax payment was originally expected in December but was not received in time to be included in the end-2011 figures.
The figures come as the Central Bank more than halved forecasts for the country's economic growth.
Any fall in growth will put pressure on the Minister for Fiinance Michael Noonan and the Government to meet targets set out by the EU/IMF/ECB troika in return for bailout loans.
In a dramatic reassessment, the bank slashed its predictions from 1.8pc to just 0.5pc growth for 2012 amid falling demand from consumers at home and for exports.
"Uncertainty remains high, however, and a wide range of outcomes is possible, including one in which the domestic economy is held back by weaker external demand for a longer than expected time," the bank said.
The Central Bank said the significant revision in forecasts was mainly down to the weaker short-term prospects for external demand.
The quarterly review and forecasts warned that Gross Domestic Product, the value of all goods and services, will fall to 0.5pc - down from 0.8pc last year - before increasing to 2.1pc in 2013.
The figure for this year matches the assessment of the International Monetary Fund, European Central Bank and European Commission following their latest review of the country's bailout programme.
The Central Bank previously forecasted 1.8pc growth for 2012 in its October bulletin and 2.1pc in July last year.
The first review of 2012 said that recovery in external demand will kick in from the second half of this year, alongside a gradual stabilisation in the domestic economy.
Taoiseach Enda Kenny said the Government's real priority is jobs and an action plan to ease unemployment would be published in the next fortnight.
"The Government's growth figures are median figures and we are prepared to stand by those," Mr Kenny said.
"(It is) very difficult for anybody to determine what the final growth figure might be but the Government have set out their figures and we stand by that."