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Exchequer returns June 2023 – Peter Vale commentary

All eyes were on corporation tax receipts in the latest Exchequer figures for June.

After a relatively weak May, today’s corporation tax figures will be warmly welcomed by the Department, with receipts for the month 19% ahead of what was a strong June 2022.

A strong June generally translates into robust November receipts, meaning that full year corporation tax figures look set to exceed what was a stellar 2022.

The figures all point to the expected large Budget surplus being delivered and augur well for future years.

Income tax receipts remain strong and while there was a slight dip in the rate of increase in June, year to date figures are running 8.9% ahead of the same period in 2022.  With the economy close to full employment, income tax receipts should remain strong for the year.

June is a quiet month for VAT receipts, although there was a noticeable dip in receipts in May.  If this trend continues in July, we may see VAT underperform but any deficit is likely to be balanced by surpluses elsewhere.

Today’s figures indicate that there will be headroom in October for a significant tax package, potentially in excess of €1bn, although the specifics remain uncertain.

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