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Press Release

Exchequer returns December 2023 – Peter Vale commentary

Another year of record tax receipts

Tax receipts for December rounded off what was another strong year for the Exchequer on the tax receipts front.

All three of the main tax heads, income tax, corporation tax and VAT, posted individual record receipts.

Income tax receipts finished 7.1% ahead of 2022, reflecting greater numbers in employment and, likely to a lesser extent, wage inflation. Income tax receipts are now 44% ahead of 2019 equivalent, which is a remarkable performance.

VAT receipts ended the year 9.4% ahead of 2022. Given the impact of rising interest rates in particular on disposable income, this is a very strong performance and demonstrates the ongoing resilience of the Irish economy. Consumers have continued to spend despite the gloomy global economic outlook.

Despite a moderation in growth, corporation tax remains a star performer, with receipts for the year over 5% ahead of what was a stellar 2022. After a series of weak months, November saw a remarkable turnaround in corporation tax receipts, likely boosted by the technology sector in particular. 

The strong November corporation tax figures will fuel hope that these numbers can be maintained in 2024. If so, the projected large Budget surpluses in the coming years look realistic.

Overall, tax receipts finished the year 6% ahead of 2022. Given the relatively weak global economic backdrop, this is a very strong performance.