Belfast Telegraph

UK Website Of The Year

Tax man rakes it in at levels not seen since economy went into free fall

The tax man last year raked in cash from workers and businesses at levels not seen since the economy went into free fall more than a decade ago.

Official figures from the Department of Finance showed 47.9 billion euro of tax was collected by the state - 2.3 billion euro more than in 2015 and more than 630 million euro ahead of predictions.

Finance Minister Michael Noonan said: "Our citizens deserve quality public services to help develop a fairer Ireland.

"The amount of tax collected in 2016 is at an historic high. It has provided not only for the extra expenditure incurred in 2016 but for the substantial tax reductions announced in the budget in October 2015 and delivered during the course of 2016."

A breakdown of the figures in the Exchequer books showed income tax contributed most to the coffers - almost 20 billion euro over the year and up 4.4% on 2015.

Payments by big businesses also surged, up 11% on the numbers from 2015 to 7.4 billion euro.

VAT topped off at 12.4 billion euro for the year, but that was 439m euro below forecasts, with commentators suggesting that the impact of Brexit and the collapse in sterling values in the wake of the vote played a part in dampening consumer spending.

The local property tax added 463m euro to the state's books.

The Department of Finance said that the Government was on target to bring the deficit for 2016 to 0.9% of GDP as it set out in the budget.

The buoyant tax returns were released on the same day as positive unemployment records showed the numbers out of work at their lowest levels since 2008.

Mr Noonan set out the increased spending on the back of improving taxes including 14.1 billion euro for health services, up almost 800m euro on the previous year.

"These levels of expenditure demonstrate the Government's commitment to improvements in public services, delivering sustainable growth in public spending at a rate that is prudent and responsible, taking account of our recent economic history," the minister said.

But the report prompted immediate pleas from business lobbyists for pay restraint in the public sector.

Ian Talbot, chief executive of Chambers Ireland, said: " The reality is that Ireland will continue to face challenges in funding public expenditure in the coming years.

"This is the context that must be considered when significant public sector pay increases are being promoted. Public sector pay demands must be realistic when faced with domestic realities as well as unprecedented international uncertainties."

Popular

From Belfast Telegraph