- Today’s Exchequer figures show that tax revenues in May were €7½ billion, €570 million, or over 8 per cent, higher than profiled and €1.3 billion up on the same month last year;
- May is a VAT-due month and receipts were strong at €2.3 billion, over €250 million, or 12 ½ per cent higher than profiled and 53 per cent higher than the same month last year;
- Income tax receipts of €2.2 billion remain robust, €200 million, or 10 per cent over profile and 34 per cent higher than in May 2020;
- May is an important month for corporation tax and receipts of €2.4 billion were received, €120 million, or 5 ½ per cent ahead of profile, but down €200 million on May last year;
- Total gross voted expenditure to end-May 2021 amounted to €33 billion, €1½ billion or 4 ½ per cent ahead on the same period in 2020 and €1.4 billion, or 4 per cent, below profile.
- The 12-month rolling Exchequer deficit stands at €12.2 billion.
An Exchequer deficit of €6,039 million was recorded to end-May. This compares to a deficit of €6,143
million in the same period last year. The €104 million improvement in the Exchequer deficit is
primarily due to increases in tax revenue. The 12-month rolling Exchequer deficit, a much better indicator of the trend, is €12,212 million.
Given the timings of various periods of restrictions last year and the unprecedented nature of the impact of the pandemic, year-on-year comparisons are of limited value and may give a misleading impression of tax revenue performance. As such, a much better guide to tax outturn in 2021 is the comparison vs profile. On that basis VAT receipts of €2,296 million, were €256 million or 12.5 per cent higher than profiled. Remarkably VAT returns were at the same level they were at in May 2019, despite a high level of restrictions in March and April this year (the months in which the May VAT liability arises).
Income tax receipts continued to be robust in May, ending the month €197 million or 9.9 per cent higher than profiled. May is a relatively significant month for corporation tax receipts and returns of €2,368 million were €120 million, or 5.4 per cent higher than profiled, although down €196m on a year-on-year basis as May 2020 was an exceptionally good month. Excise duties of €412 million were €35 million or 7.8 per cent lower than profiled and up 34.5 per cent year-on-year.
Total gross voted expenditure to end-May 2021 amounted to €32,996 million, €1,456 million or 4.6 per cent ahead on the same period in 2020 and €1,382 million, or 4 per cent below profile. The underspend vis-a-vis profile is the result of a number of factors including the closure of construction sites earlier in the year.
Commenting on the figures, the Minister for Finance, Paschal Donohoe T.D. said:
“Today’s Exchequer returns show that although we continue to borrow heavily to support incomes and businesses through the pandemic, the economy has started to recover. VAT receipts, in particular, show that both consumers and business are feeling more confident about the future. As our vaccination programme continues its successful rollout, we can look forward to a sustainable and broad based recovery”.
The Minister for Public Expenditure and Reform, Michael McGrath T.D. said:
“Total gross voted expenditure to end-May 2021 amounted to almost €33 billion. On a 12 month rolling basis, this brings gross voted expenditure to €86¾ billion, €14 billion or 19% ahead on the 12 months to end May 2020. This highlights the scale of the resources that Government continues to provide to support our health and other frontline services to respond to the crisis and to support our citizens and businesses whose livelihoods have been severely impacted by the pandemic.“
Ends