Revenue tax take for year to date up 8.4%
TAX REVENUES grew strongly last month, possibly signalling the reversal of a trend towards faltering tax returns that began in the spring.
September tax receipts were one-eighth higher this year compared to the same month last year. This followed two consecutive months of shrinking revenues.
For the first nine months of the year, total tax revenues stood at €26.1 billion, up €2,020 million (or 8.4 per cent) on the same period last year. When adjusted for one-off factors, the underlying increase was somewhat smaller, at an estimated 6.2 per cent year on year Revenues also exceeded Department of Finance projections for the nine-month period, coming in €385 million (1.5 per cent) ahead of forecasts.
Income tax – the largest source of tax revenue – was €101 million (1 per cent) ahead of projections at the end of September, and is up just over 9.5 per cent year on year on an adjusted basis.
Value added tax – the second-biggest revenue source – was €94 million (1.1 per cent) ahead of target for the first nine months of the year cumulatively, and up €264 million (3.3 per cent) year on year. Corporation tax revenue was €251 million (11.4 per cent) ahead of projections in the period to end-September.
Compared to the same period last year, and when adjusted for exceptional factors, receipts from profits tax was up 7.4 per cent.
On the spending side, total net voted expenditure, at €33,248 million at end-September, was €338 million (1 per cent) ahead of projections.
In year-on-year terms, net voted expenditure is €105 million (0.3 per cent) below the same period in 2011.
This masked considerable differences in performances among spending departments.
The Departments of Health and Welfare continue to account for most overspending. In the first nine months of the year, the two ministries were spending 3 and 4 per cent more than budgeted for respectively.
Over the past three months, the health overspend has increased, while the social welfare one has narrowed.
In cash terms, at the end of September the two department combined had overspent to the tune of €650 million.
As has long been the case, underspending in capital expenditure has partially offset the overspends in health and welfare.
At end-September, capital spending was €268 million (13.6 per cent) below projections and €474 million (21.8 per cent) down year on year.
In a joint statement, Minister for Finance Michael Noonan and Minister for Public Expenditure and Reform, Brendan Howlin said that “The tax base is growing, the majority of departments are managing expenditure within allocations and where there are overruns action is being taken to bring these under control. All departments must take the necessary measures to deliver services within their 2012 allocations.”
The Ministers also said: “Overall, we are on track to meet our budgetary targets for the second consecutive year, and September 2012 is the third month this year in which exchequer revenues exceeded expenditure. This last happened in 2007.”