article banner

Exchequer Returns September 2018 - Peter Vale commentary

Peter Vale Peter Vale

Anyone expecting any major surprises in the final set of Exchequer figures pre Budget will have been disappointed.  This was another solid set of figures, with the overall tax take year to date close to target.

September is a “VAT month” and particularly relevant coming days before the Budget. While VAT figures are well ahead of last year, they remain behind target and perhaps increasingly influenced by a dip in consumer sentiment around Brexit, plus a change in spending patterns given a weaker sterling. 

While higher income tax figures indicate additional disposable income, this isn’t translating into the same level of additional spending, certainly not in the Irish market.

September is also a key month for corporation tax. The good news is that the figures for the month were very strong, with buoyant corporation tax receipts continuing to prop up deficits elsewhere. Despite significant developments on the international tax front, there is no sign at present of a dip in corporation tax receipts, which remains a genuine concern of the Department.

In summary, there is nothing in today’s figures that should cause the Minister to reshape his thoughts in advance of next week’s Budget. We expect several revenue raising measures to be introduced, with VAT and stamp duty changes prominent. Similar to previous years, the main beneficiaries will be lower and middle income earners