Tax receipts hit new record highs in almost all areas last year, with the Revenue Commissioners reporting that almost £14 billion of total revenue was collected, an increase of 15 per cent on the 1996 figure of just over £12 billion.

PAYE taxes remain the single biggest contributor, with employees increasing their income tax return by 12 per cent, contributing £4,356,000 to the Exchequer compared to £3,894,000 in the previous year, and illustrating the increased employment and higher salaries being paid.

The Revenue continues to reduce its recorded level of total tax arrears, which fell from £1.690 billion at the end of 1996 to £1.329 billion last year. The bulk of the fall was due to a write-off of £281 million as being impossible to collect in accordance with a policy approach agreed with the Comptroller and Auditor General.

The target is to reduce this figure to £1 billion next year, with much of the write-off due to the revision of unrealistic tax estimates made under previous tax collection procedures.

"There was a clear inflation of debt which was not real debt and which has now been remedied by the self-assessment system," according to Revenue Commissioner, Mr Dermot Quigley. The overall tax increase was mainly due to the buoyant economy, according to Mr Quigley, but also due to the Revenue Commissioners operating more efficiently. Improvements in tax compliance were occurring continuously and, coupled with their own improvements in streamlining, they could cope with higher volumes of monies coming in.

According to the Revenue's annual report, the revenues were "considerably ahead of forecast". The total amount of receipts handled by revenue amounted to £18 billion - up from £15.7 billion in 1997 - and an increase of 7.6 per cent over the Budget target. However, £4 billion of this was paid out again in the form of VAT and other repayments.

After PAYE taxes, VAT was the next biggest contributor last year, with taxes up 19 per cent to £3.7 billion. The next biggest sum was for excise duty, amounting to £2.5 billion, an increase of 9 per cent on 1996 and "reflecting growth in consumer spending as well as the impact of the Budget increases in the duty on petrol, auto diesel and tobacco," according a Revenue statement.

Corporation tax contributed £1.7 billion to State coffers, up by 19 per cent on the £1.4 billion paid in the previous year, and illustrative of widespread company profitability.

The bigger increase in income tax returns occurred among the self-employed. The take in that section increased by 22 per cent, from £527 million to £644 million, reflecting an increase in income and, lesser so, the numbers of people opening new businesses. Among the different tax categories, the biggest increase was for capital gains tax, which went from £83.7 million to £132.4 million, a rise of 58 per cent. This demonstrates an increase in share prices and transfers and economic activity in the property sector. The stamp duty take also rose significantly, from £332.3 million to £424.3 million, an increase of 27 per cent and reflecting the buoyant housing and stock market. DIRT payments, payable on interest on bank and building society deposits, increased from £125 million to £148 million, an increase of 18 per cent.

Mr Quigley said that the Customs National Drugs Team had seized drugs with an estimated street value of £7 million during the year. This contrasts with an estimated £148 million worth of drugs sized in 1996, including two seizures amounting to £102 million.

But he said that there had been seizures abroad due to information provided by the Customs, and the figures did not reflect garda seizures, while there was "extensive co-operation" with the Criminal Assets Bureau.