Government tax revenues climb 14.5% in February as income tax receipts surge

New figures show Ireland's finances remain in a healthy state as the economy emerges from the Covid crisis

Minister for Finance Paschal Donohoe File Picture

The Government collected €3.45bn in tax revenues in February — up by 14.5% from a year earlier — as income tax revenues surged, the latest exchequer returns show.   

The figures from the Department of Finance confirm the Government finances remain in a healthy state as the economy emerges from the Covid crisis.  

Revenues from income taxes brought in €2.1bn, or over 60% of all revenues in the month. February is a so-called non-payment month for Vat. It is also not a significant month for companies paying corporate tax revenues which had climbed to a new record in 2021.

"The strong income tax performance reflects the ongoing recovery in the labour market, alongside continued wage increases in sectors less affected by the pandemic, while the significant increase in Vat receipts is driven by the rebound in consumer spending," said Finance Minister Paschal Donohoe.

For the first two months of the year, the exchequer posted a budget surplus of €900m.    

Meanwhile, the unemployment rate which includes people requiring the pandemic unemployment payment fell to 7% in February from 7.8% in the previous month.  

Economists say that unemployment has fallen quickly from the crisis but nonetheless is still ahead of the sub-5% rate in February 2020 at the onset of pandemic.