Exchequer records a surplus of 6.3 billion euro

The latest Exchequer figures recorded a surplus of 6.3 billion euro at the end of August.

Figures released by the Department of Finance shows this compares to a deficit of 6.7 billion euro recorded at the end of August last year, an improvement of 13 billion euro.

The department said the increase reflects strong growth in tax revenues and the unwinding of Covid-19 supports coupled with the reopening of the economy.

The figures show that on a 12-month rolling basis, the Exchequer surplus stands at 5.6 billion euro.

Tax revenue to the end of August was up 26.3% compared with last year, at 49.8 billion euro.

That represents an increase of 10.4 billion euro. The increase is driven by strong growth in income tax, VAT and, in particular, corporation tax.

The total expenditure until the end of August was 59.8 billion euro.

The August figures will give a boost to the Minister for Finance’s spending plans on Budget Day, to be announced later this month.

However, Paschal Donohoe has ruled out increasing Government spending based on record tax receipts.

He said the Government has not changed its spending plans despite increases in corporate tax.

Speaking on Friday, he said: “What this is about is ensuring that the Government and I, as Minister for Finance, don’t make decisions today that create really big problems for us tomorrow.

“That’s not being doctrinaire, that is about ensuring, just as we did during Covid, that what we do to help now we can afford, and that we can emerge from this great difficulty, which we will – we will get through this, we will overcome the challenges that are there.

“We don’t do that having created new economic risks.”