Level 5 restrictions continue to impact on the public purse with a significant decline in Government tax revenue last month.
Exchequer figures show that tax revenues were down €520 million in January, compared to the same period last year, a nearly 9 per cent drop.
VAT was down 13 per cent, while excise duties fell by 20 per cent.
Income tax receipts remain robust, up €85 million, or just under 4 per cent.
Pandemic Unemployment Payments, amounting to over €500 million, were paid entirely from the Social Insurance Fund (SIF) in January. The SIF is a non-Exchequer fund and therefore does not impact the Exchequer balance. Spending from the SIF does, however, worsen the general government deficit.
Commenting on the figures, Minister for Finance, Paschal Donohoe said: ‘Today’s figures show the impact public health restrictions are having on consumer spending. January is usually the largest month for VAT receipts, but, as expected, due to restrictions in November and late-December this month’s figures are significantly down on last year. Tax receipts will again suffer over the coming months as the effects of the current restrictions are felt.
“However, there is light at the end of the tunnel. Case numbers have fallen and the roll-out of the vaccine continues. Income tax receipts have shown again how well many companies have adapted. For those companies that rely on face-to-face interaction, such as the hospitality sector, the Government will continue to provide a wide range of supports for individuals and businesses."
