The final set of exchequer figures before the election points to strong tax returns in January after a Christmas uplift in the retail sector and a jump in new year car sales.
The Revenue collected almost €4.5 billion in the first month of 2016, up €308 million or 7.3 per cent on January 2015.
Although monthly tax returns fluctuate, the data shows the exchequer was in surplus to the tune of €1,198 billion in January compared to a €781 million surplus one year previously. “This €418 million improvement in the exchequer balance is driven by increased tax receipts and reduced expenditure,” said the Department of Finance.
Total gross voted expenditure reached €4.44 billion in the month. This was down by €367 million or 7.6 per cent in year-on-year terms but the department attributed that to “ timing issues.”
The figures suggest tax collection continues to run ahead of target, although the full profile of expected monthly receipts will not be published until later this week.
However, the budget in mid-October was predicted on the achievement of a 5.8 per cent increase in tax revenues. A tax surge in the final weeks of 2015 means that the real increase required to realise that objective is 3.6 per cent.
The new figures reflect strong VAT returns from the Christmas period but an advance in income tax returns last month comes before the full impact of the income tax cut introduced on January 1st filters into the monthly returns.
VAT collection came close to €2.1 billion in January, an increase of €130 million or 6.6 pe recent on the same period in 2015. “This strong performance is in-line with the positive retail data and consumer sentiment from December,” said the department.
Income tax receipts reached €1.63 billion in the month, up €131 million or 8.7 per cent on January. The outturn was consistent with figures showing employment growth and increases in average weekly earnings, the department said.
Excise duties reached €500 million, up €111 million or 28.7 per cent as strong vehicle registration tax returns followed a big rise in car sales.
At the same time, the figures show that total returns from corporate tax, the local property tax and stamp duties were down year-on-year by €61 million.
Corporate tax collections, which rose strongly throughout 2015, came in at €24 million, which was down €26 million on the same month last year. However, the department said January “is not a significant month” for the tax.
