Extraordinary tax receipts not surprising
Strong ICT sector and buoyant labour market
Tax revenues of €8.9 billion were collected in May 2022, up by €1.4 billion, or 18% on May 2021, with the bulk of the increase driven by corporation tax, income tax and VAT. Total tax receipts for the year to date now stands at €30.1 billion, which is €6.4 billion or 27% higher than the same period in 2021, and €8.4 billion or 38% higher for the same period in 2019.
The extraordinary performance of corporation tax, income tax and VAT is not surprising given the strength of the ICT sector and the buoyancy of the labour market. However, we need to be conscious of the dual nature of the Irish economy whereby the domestic economy is likely to feel the full impact of inflationary pressures in the coming months.
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Tom Woods
Head of Tax
KPMG in Ireland
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