Tax take rises to €12bn so far this year, driven by income tax, excise and VAT receipts

The State collected €12 billion in taxes in the first two months of the year, new figures from the Department of Finance show.

That is up 5.5% or €600 million on the same period last year.

The increase was driven by income tax, excise and VAT receipts.

However, the Department said a technical factor with VAT has artificially lowered the year-on-year growth rate.

When this is adjusted for, it said overall tax revenue growth stood at around 6.5% overall.

In February, income tax receipts of €2.4 billion were recorded, up over 9% on the same month last year.

So far this year, income tax receipts were up 5.7%.

February is not a significant month for corporation tax, with receipts of €500 million collected in the month, down €70 million on the same period last year.

On a cumulative basis, receipts of €600 million are down by €63 million .

February is also a non-VAT due month, with receipts of €400 million collected in the month, up almost 13% on the same month last year.

So far this year, VAT receipts of €4.3 billion are up almost 5% on the same period last year.

The Department said once a technical factor is adjusted for, that year-on-year growth stands at around 7.5%.

Excise duty receipts of €400 million were collected in February, up by €100 million on the same month last year.

So far this year, excise receipts of €1 billion are up on the same period last year by 18.6%.

Minister for Finance, Michael McGrath said growth in tax revenues across the first two months of the year is broadly consistent with the Government’s forecast on Budget day.

But he said it is too early to draw any conclusions about the trajectory of tax receipts – particularly before the key corporation tax payment months.

“The coming months will provide a firmer indication of the pattern of tax receipts across the year,” he said.

Today’s figures show the Exchequer recorded a deficit of €100 million to the end of February, down from a deficit of €2.5 billion during the same two month period last year.

On a 12-month rolling basis, the Exchequer recorded a surplus of €3.6 billion.

Meanwhile, total gross voted expenditure to the end of February reached €15 billion, 22% ahead of the same period last year.

Tom Woods, Head of Tax at KPMG said the figures for next month will give a better indication of how the economy is shaping up in 2024.

“Economic data for March will also tell whether Modified Domestic Demand for Quarter one of 2024 recovered from the decline recorded in Quarter four of 2023,” he said.

Article Source – Tax take rises to €12bn so far this year, driven by income tax, excise and VAT receipts – RTE

Copyright and Related Rights Act, 2000