Tax revenues for the first six months of the year are approximately half a billion euro ahead of target, the Department of Finance has said at the publication of the latest exchequer returns.
Total tax revenues were €18.46 billion in the six months to the end of June, a 4.9 per cent increase on the same period last year, and 1.2 per cent ahead of target.
Tax revenues were approximately €221 million ahead of target in money terms and when receipts temporarily delayed because of the single European payments area regulation (Sepa), are taken into account, the total figure is appoximately €500 million, according to John Palmer, principal officer with the department’s central budget section.
The continuing positive news on the public finances will feed into debate on the extent to which Ireland should seek, in next year’s budget, to cut the deficit by another €2 billion, or go for a percentage target that would mean less in money terms.
The Revenue Commissioners has told the department that most of the €285 million in corporation tax expected in the period to the end of June, but delayed by Sepa, “turned up yesterday”, Mr Palmer told reporters.
Exchequer returns released today show that an increased tax take, reduced expenditure and a significant reduction in bank guarantee payments helped bring in a deficit for the period of €4.94 billion, as against €6.6 billion for the same period last year.
Income tax, VAT and excise duty for the first six months of the year were all up, while corporation tax, at €1.7 billion, was down 9.4 per cent.
For the month of June, total tax revenue was €225 million below target. However the Department of Finance said this was due to Sepa, which meant an estimated €285 million in corporation tax that would otherwise be paid in June, is now being paid in July.
Income tax for the first six months of the year was €7.83 billion, an increase of 7.4 per cent on the previous year and 0.8 per cent ahead of target. VAT receipts (€5.59 billion) were up 7.3 per cent year on year, and were 2.1 per cent ahead of target. Excise duty was €2.38 billion, 7.2 per cent up on the same period last year, and 6.7 per cent ahead of target.
For the month of June, income tax was up 5.4 per cent, year on year, but 3.9 per cent behind target. However the department said the €50 million shortfall was not significant. VAT was up 86.1 per cent, year on year, and 27.2 per cent ahead of target.
Net voted expenditure during the first six months of 2014 was €20.52 billion, down €450 million, or 2.1 per cent, on last year, and 0.6 per cent below target.
However overruns continued in Health, with spending of €206 million being 3.4 per cent above the Government’s target. The overspending at Health was offset by underspending in many other departments, most notably the Department of Social Protection, where spending, at €129 million, was 2.1 per cent below target.
Voted capital expenditure, at €859 million, was 7.4 per cent down as against 2013, and 10.3 per cent lower than was targeted for.
Debt-servicing costs for the first six months of this year were €4.94 billion. This was €114 million less than for the same period last year but was largely the result of timing factors, according to the department.
