Borrowing to be undershot

PAYEThe Exchequer finances, already buoyed by economic growth, will receive a further bonus from the €650 million collected from the offshore disclosure scheme.

The sum is significant when put against an annual estimated borrowing requirement of €2.8 billion, which now looks likely to be considerably undershot.

The announcement of the figures by the Revenue led to calls from Labour and the Green party for additional public spending. Labour called on the Government to put the funds into health and education, while the Greens pointed out that there was now no excuse not to diverse the Budget cutbacks in social welfare.

However the Minister for Finance, Mr McCreevy, is likely to argue that the funds received under the scheme are a once-off receipts and should not be used to push up current spending.

The Revenue report shows that the PAYE sector remains by far the main source of income tax, according to the Revenue Commissioners annual report published yesterday. Some €7.2 billion was collected from the sector last year, up 7.2 per cent on the previous year. In contrast, the self-employed paid €1.372 billion, down from €1.6 billion in 2002.

Most of the figures for tax collection were already announced as part of the Exchequer returns for 2003. However the Revenue figures highlight the return from the PAYE sector, which came in almost exactly on the Budget estimate.

The report shows that 16,000 Revenue audits were carried out yielding €452.65 million, a substantial increase of €160 million on 2002 and reflecting the Revenue's drive to focus on major cases

The Revenue also continued its programme of reducing its outstanding debts. This is now down to €1.3 billion . A total of €119 million was written off last year compared to €178 million the previous year.