Business Irish

Saturday 17 March 2018

Tax take for 2015 at €45.6bn, more than €3bn above expectations as economy surges ahead

Minister Michael Noonan
Minister Michael Noonan
Minister Michael Noonan arriving at the Department of Finance this morning after spending Christmas in hospital after undergoing surgery
Ailish O'Hora

Ailish O'Hora

The government took in tax revenues of €45.6bn in 2015, more than €3bn above expectations and a year-on-year increase of €4.3bn.

This means that we are over €8bn better off than this time last year but when you strip out once-off gains the figure is €5.2bn.

The exchequer deficit at the end of the year was €62bn compared to a deficit of €8.2bn in the same period last year as the economy surged ahead.

Levels like this have not been seen since the Celtic Tiger years.

The improvement in the Exchequer balance is driven by increased tax and non-tax receipts, reduced interest expenditure and a number of one-off transactions.

Tax receipts for the month of December were €360m above profile.  Generally, there were strong performances in a number of key sectors including income tax and corporation tax.

Non-tax revenues of €3,5bn, were up €550m in year-on-year terms. The primary reason for this is the increase in the surplus income from the Central Bank of about €500m.

The effects of higher consumer spending in the run up to Christmas will not be seen until next month's January figures.

While the country still has significant debts, the latest figures bring the Government within a whisper of balancing the books.

And they also come as growth in the economy powers ahead with Government growth expectations at 4.3pc on the back of a 6.2px figure for 2015.

However, the figures also come against the backdrop of external pressures n world markets from weak economic data in China to a slump in international stock markets as tensions in the middle east have heightened in recent days.

In addition, it comes as world oil prices are at record lows.

“Overall, an Exchequer deficit of €62m was recorded at end-December 2015." said Finance Minister Michael Noonan who returned to work today after a hospital visit as a result of a chest illness.

"This is a massive improvement from a deficit of €8.1bn for 2014 which was buoyed by a return from some of our investments in the banking sector.

"When once-off factors are accounted for, we have an underlying Exchequer deficit in 2015 of around € compared to an underlying deficit of about €8.6bn in 2014. 

"In terms of performance against profile, while corporation tax accounts for the bulk of the increase, it is encouraging that there were also strong performances from income tax and VAT.  This is further evidence of the economic recovery we have witnessed in 2015," he added.

Minister for Public Reform Brendan Howllin said: "We have spent €54.7bn to deliver public services and invest in our infrastructure during 2015.

"Against a background of strong growth in tax revenue we were in a position to make additional funding available by way of Supplementary Estimate to support key services, social supports and increased capital investment. "

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