From Department of Finance; Department of Public Expenditure, NDP Delivery and Reform
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November is the largest tax collection month of the year; as well as being a VAT-due month, it is the single most important month for income tax receipts (deadline for self-employed income tax payments) and for corporation tax receipts.
Corporation tax receipts in November were very strong, with receipts of €5 billion, up €1 billion compared with the same month last year. Overall, corporation tax receipts amounted to €21.1 billion in the year to end-November, up by €7.6 billion relative to last year, driven by strong increases in profitability in the multinational sector.
Income tax receipts of €4.4 billion were collected in November, up €0.6 billion relative to the same period last year, reflecting continued increases in earnings as well as the strength of self-employed income. At €28.3 billion to end-November, income tax receipts remain robust, up almost 16 per cent compared with the same period last year, reflecting the continued strength of the labour market.
Reflecting the recovery in consumer spending, VAT receipts to end-November amounted to €18.5 billion, up 22 per cent on the same period last year. At €5 billion to end-November, excise duty receipts were down 5 per cent on an annual basis. The fall in receipts reflects, in part, policy measures introduced to mitigate increases in the cost of living.
Total gross voted expenditure to end-November amounted to just under €75 billion, €234 million or 0.3 per cent ahead of the same period in 2021. This reflects the payment of some cost of living supports to households which were introduced throughout 2023 and the provision of humanitarian supports for people arriving from Ukraine.
An Exchequer surplus of €12.1 billion was recorded in the year to end-November 2022. This incorporates the transfer of €2 billion to the National Reserve Fund earlier this month. The end-year surplus will be much lower as December is the largest month for expenditure and because the fiscal accounts do not yet fully reflect the Winter Cost of Living package.
The 12-month rolling Exchequer surplus, a better measure of the trend, stood at €6.2 billion at end-November. However, if windfall corporation tax receipts are excluded, this amounts to an underlying deficit of approximately €5 billion on a 12-month rolling basis.
Commenting on the figures, the Minister for Finance Paschal Donohoe said:
“Today’s figures show that tax receipts remained very robust to end-November. The ongoing strength in income tax, in particular, is a positive signal of the continued momentum in the labour market.
"However, the strength of potentially volatile corporation tax receipts provides an artificially positive picture of the public finances.
"Corporation Tax collected this year will be double the level in 2019 and around five times the level a decade ago. If windfall corporation tax receipts were excluded a significant deficit would be in prospect this year.
"The government has not used corporation tax receipts that may prove transitory to fund higher levels of permanent spending. Earlier this month, I transferred €2 billion to the National Reserve Fund and a further €4 billion will be transferred next year.
"Our economy has recovered remarkably well from the shock caused by the impact of COVID-19. This is due to the careful management of our public finances during what was a testing period for the country.
"I fully appreciate that for so many the rising cost of living, and in particular, the cost of energy is a real challenge. The government has and will continue to help citizens and businesses deal with these rising costs but we must ensure that the support we provide is sustainable and does not put our public finances on an unsustainable path. By delivering a budget surplus and putting aside these potentially transient corporation tax receipts it will ensure that we are in a position of strength to deal with unforeseen challenges that may yet be around the corner as well as the more longer-term challenges that we need to make progress on too."
The Minister for Public Expenditure and Reform, Michael McGrath, said:
“At end November €75 billion has been invested to date in 2022 across a range of public services to support households, businesses and the economy.
"The higher than profiled level of current expenditure reflects the government’s response to a series of external challenges experienced this year including high levels of inflation and the war in Ukraine. The Winter Cost of Living package is currently being rolled out with households benefitting from additional social protection payments and the electricity credit scheme. Additional resources are also being put in place to provide humanitarian supports to those arriving in Ireland from Ukraine.
"Capital investment levels are 10% higher on an annual basis. This reflects the implementation of the National Development Plan to support rural, regional and urban development across the country.“