The slow down in the residential property market has seen revenues from stamp duty fall by more than €500 million or around 16 per cent at €2.7 billion, according to the latest Exchequer returns from the Department of Finance.
Revenues from capital gains taxes are also down at €1.3 billion, more than 13 per cent below the forecast of €1.5 billion at this stage of the year. Stamp duty returns were expected to come in at around €3.2 billion by the end of October.
Over the first ten months to date the Exchequer returns shows that overall tax revenues were €34.9 billion, less than 2 per cent lower than the target set out at the start of the year.
To date the Exchequer is running a deficit of €3.9 billion, compared with €345 million at the same stage last year.
Excise Duty is also somewhat lower than expected with €4.7 billion collected by the end of October, some €200 million less than expected.
Reacting to the news this evening to Fine Gael spokesman on finance Richard Bruton said that Mr Cowen "has blown it and ... the Fianna Fáil Government's tax bonanza is over".
"Stamp Duty, Capital Gains Tax and Vat, the main taxes affected by the property boom collectively, are running €721 million short of expectations," he said.
"These trends are simply unsustainable. Spending is growing at 17.5 per cent - three times the 5.5 per cent rate of growth of Revenue. Next year Minister Cowen plans to plug the hole by borrowing. In place of a surplus of €1,800 million that he predicted before the election, he is now planning a deficit of €800 million.
"Now that the election is over, Minister Cowen has admitted to a massive €5,000 million black hole in the tax projections on which he based his Manifesto commitments. All of the glossy promises will be shelved. The Taoiseach is calling for wage restraint.
"This diagnosis may be correct for the economy, but Minister Cowen won't take his own medicine. The final insult must surely be the cavalier decision by Government ministers to award themselves a massive pay increase.
There was some good news in the figures for the Government. Revenue from income tax stood at €10.3 billion by the end of October, more than €300 million ahead of predictions.