THE tax take will be €1.8bn behind target by the end of this year and continue to fall in 2010, official projections have indicated.
In addition, job losses and pay cuts mean that the social welfare budget will increase next year, placing further pressure on the public purse.
The 2010 Estimates of Receipts and Expenditure, released by the Department of Finance overnight, indicate that, by the end of this year, the total tax take will reach just €32.75m.
That’s a full €1.8bn behind the target set by the Government just last April.
But the estimates indicate that things will get even worse next year, when the tax take is estimated to total just €31.93bn – or about €640m less than this year.
In addition, the Government estimates that the Department of Social Welfare will cost about €13.6bn to run in 2010 – almost €3bn more than this year.
On the plus side, however, the Government expects to raise €1bn in fees from the financial institutions covered under the bank guarantee scheme.
All told, the Government is projecting that it will bring in just €35.9bn next year and spend €57.8bn – meaning an Exchequer deficit of roughly €21.9bn.
However, these projections are on a “pre-Budget basis” – meaning they do not take into account next week’s budget, when an estimated €4bn will be cut from spending. That would lower next year’s deficit substantially.
Nonetheless, Fine Gael described the figures as “frightening” last night, and accused the Government of losing control of the economy.
“The projections in these estimates are frightening, with Ireland set to borrow more in the face of falling tax receipts, rising unemployment and soaring social welfare spending,” Fine Gael finance spokesman Richard Bruton said.
“And these projections do not even include the additional borrowing that may be required if the Government decides to try to keep Anglo Irish Bank afloat.”
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