Ireland’s Exchequer “flush with cash”

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Last year, Ireland recorded an Exchequer surplus of €1.2 billion, marking a decline of €3.8 billion from the surplus recorded in 2022. This reduction was attributed to various factors, including increased public expenditure and a €4 billion transfer from the Exchequer to the National Reserve Fund in the first half of the year, which is considered neutral from a general government accounting perspective.

Total tax receipts for 2023 amounted to €88.1 billion, reflecting a €5.0 billion (6 per cent) increase from the previous year. The growth in tax revenue was primarily driven by higher income, VAT, and corporation taxes, aligning with the projections outlined in the Budget 2024.

Income tax receipts reached €32.9 billion in 2023, surpassing 2022 by €2.2 billion (7.1 per cent), attributable to robust employment and nominal wage growth. VAT receipts for the year totalled €20.3 billion, registering a €1.7 billion (9.4 per cent) increase from 2022, driven by elevated consumer spending.

Corporation tax receipts closed the year at €23.8 billion, marking a €1.2 billion (5.3 per cent) increase from 2022, showcasing a more moderate growth rate compared to previous years.

Excise receipts in 2023 amounted to €5.6 billion, rising by €0.2 billion (3.2 per cent) from the previous year.

Total gross voted expenditure for the year reached €94.7 billion, marking a significant increase of €5.9 billion or 6.9 per cent from 2022.

Minister for Finance, Michael McGrath T.D., commented on the figures, noting the Exchequer surplus and emphasising the importance of cautious fiscal commitments, especially considering the windfall corporation tax receipts. He highlighted the establishment of the Future Ireland Fund and the Infrastructure, Climate, and Nature Fund as measures to prepare for future challenges while managing exposure to volatile revenues.

Minister for Public Expenditure, NDP Delivery, and Reform, Paschal Donohoe T.D., emphasised the government’s commitment to sustainable investment in public services, with gross voted expenditure reaching €94.7 billion in 2023. Looking ahead to 2024, the Revised Estimates project a commitment of €96.6 billion, reinforcing support for public services, infrastructure, and various household improvements.