Exchequer returns May 2025 – Peter Vale commentary

After November, May is typically the most important month for the Exchequer, hence there was a particular focus on today’s numbers.

Overall, the picture was mixed, with solid income tax and VAT numbers but a drop in corporation tax revenues. 

Income tax returns remain robust, with little indication of employee remuneration pressure in the latest figures, up 4.5% year to date.

May VAT returns were also solid, up 4.4% on the same month last year. Returns for the year to date are running at 5.5% ahead of 2024 equivalent, reflecting strong consumer spending despite the global economic turmoil.

Corporation tax receipts for May were significantly down on May last year, which the Department noted was down to once-off receipts in May 2024.

While once-off factors distort the figures, we would have expected a stronger performance from corporation tax this month, perhaps boosted by advance pharma revenues due to stock piling in the US.

The weaker corporation tax figures in May may be a portent of weaker figures to come, in particular, in the key months of June and November. The June corporation tax figures now take on added importance.

Overall, a mixed bag this month and all eyes on June's corporation tax figures.