Wednesday 16 October 2019

February exchequer surplus less than expected

(stock photo)
(stock photo)

David Chance

The Exchequer surplus for February came in lower than expected at €139mn, according to Department of Finance data issued on Monday.

That compares with €217mn a year ago and a forecast of a rise in the surplus to €325mn by Cantor Fitzgerald.

The Department of Finance said that there was an increase in non-voted current spending, excluding debt service costs of €138mn from a year earlier that was caused by a rise in European Union budget contributions.

While it is too early in the year to make any projections as to whether the exchequer would hit its €2.25bn deficit target for this year, corporation tax revenues continued their strong run and were €194mn higher  than expected.

The State recorded a surprise budget surplus last year as overspending, largely on health, was outpaced by surging company tax revenues, which have overshot their collection targets by a cumulative €14.3bn since 2015.

The outcome for 2019 however will depend on whether Britain leaves the European Union with a deal, or crashes out on March 29 without one.

If there is no deal, the Central Bank of Ireland estimates that economic growth could be 4pc points below forecasts, which would cause the budget deficit as a percentage of gross domestic product to widen by 2pc points.

Online Editors

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