Tariffs will hit families, businesses and job creation, Minister for Finance, Paschal Donohoe, warned on Thursday as exchequer figures showed high employment and consumption.
Revenue collected €21.9 billion in tax in the three months to the end of March, according to exchequer returns, which detail Government income and spending, published on Thursday.
Including the impact of September’s European Court of Justice ruling requiring the State to recover tax from iPhone maker Apple, the Republic’s total revenue to the end of March was €23.6 billion.
That was €3.5 billion more than in the first three months of last year.
Workers paid €8.2 billion in income tax during the three month period – 3.6 per cent or €300 million more than during the first quarter of 2024.
VAT, levied on the goods and services that households buy, earned €7.6 billion for the exchequer in the first quarter, €500 million more than during the same period last year.
The figures reflected historically high levels of employment in the Republic, Mr Donohoe noted, while adding that VAT showed strong rates of consumption.
He argued they showed that the State was “at least” facing the threat of US president Donald Trump’s plans to levy tariffs on imports with a resilient economy.
“Tariffs are harmful,” he warned. “They increase the cost of business, the cost of living and they could have a really adverse impact on jobs in the years ahead.”
Mr Donohoe said that Department of Finance calculations concluded that Mr Trump’s proposals could cost the Republic between 55,000 and 80,000 jobs over the medium term.
That could be a mix of jobs lost and not created as a result of the US import levies, he explained.
The minister also noted that IDA Ireland, the agency responsible for luring overseas investment to the Republic, had confirmed that some US companies had stalled on plans locate or expand their presence here.
Mr Donohoe told reporters that the Government’s and EU’s “preferred response” was to negotiate with the US administration to prevent tariffs’ imposition or reduce the harm they might inflict.
Europe’s response will be “firm, fair and proportionate”, he added when asked about likely retaliatory measures.
Tom Woods, head of tax at KPMG, predicted that the tariffs’ impact on trade would be visible immediately, but their consequences for “profitability, employment and the related tax revenues will take longer to manifest”.
The exchequer returns showed that businesses paid €3 billion in corporation tax on their profits in the opening three months of 2025, an increase of €600 million on the same period last year.
Including the gain from the Apple tax ruling, corporation tax returns for the period totalled €4.8 billion.
Mr Donohoe said the Government saw no reason to change forecasts for this year’s corporate tax take, but added that the medium-term impact “really does depend on what happens globally”.
Peter Vale, Grant Thornton tax partner, said corporate tax returns would suffer a severe and immediate impact if the US extended tariffs to pharmaceuticals, a key source of State revenue.
Government spending grew €2 billion in the first quarter to €24.8 billion. That included a €700 million, or 42 per cent, increase to €2.5 billion on State-funded infrastructure projects, including housing, according to the Government.
Jack Chambers, Minister for Public Expenditure, National Development Plan Delivery and Reform, said this reflected the accelerated pace at which the State was working to hit National Development Plan targets.
However, he maintained that the State’s own systems for providing infrastructure were actually impeding many projects.
Mr Chambers avoided going into specifics, but he said opponents had paralysed decisions on key planning applications. “Those who would seek to object and frustrate social and economic objectives have the upside in how the systems operate. We need a rebalancing of that,” he said.
Mr Chambers’ department includes a new infrastructure division. “We need to have structural reform in our delivery systems,” the minister added.
He noted that the exchequer figures indicated that the Republic was facing likely global uncertainty from a strong position.
