November tax take ahead of target

TAX REVENUES collected by the Government in the key month of November came in ahead of the Department of Finance’s expectations, lifted mainly by improved fortunes for the corporate sector.

The latest exchequer data shows tax receipts for the first 11 months of 2010 arrived at €29.5 billion, about 1.6 per cent ahead of projections. However, a large surplus of €589 million in corporation tax receipts was partially cancelled out by a €356 million shortfall in income tax.

The Department of Finance attributed the weak performance in income tax to below-target PAYE receipts and said income tax from self-employed people in the post-deadline month of November had performed well.

Fine Gael finance spokesman Michael Noonan said the figures exposed “a deep divide” now running through Irish society. “The multinational sector and large companies are enjoying a moderate resurgence. But large numbers of Irish families have been stranded on the other side of this divide,” he said. “The ongoing fall in income tax reflects . . . the overall weakness of the employment market.”

Labour Party finance spokeswoman Joan Burton said the 4.1 per cent year-on-year decline in income tax receipts served to “underline the challenge facing any government in meeting the onerous repayments” negotiated by the Government with the European Union and the International Monetary Fund.

The exchequer deficit stood at €13.3 billion as of the end of November, compared to €22 billion at the same point last year. The improvement is largely due to payments of €3 billion to the National Pensions Reserve Fund and €4 billion to Anglo Irish Bank, which were made in 2009.