€8.9 billion deficit in public finances recorded in November
The public finances recorded a deficit of €8.9 billion in November, according to the latest Exchequer figures.
This compares to a surplus of €3.355bn in November last year.
It is also an improvement on the €11.7bn deficit recorded at the end of October, largely due to some one-off factors.
The deterioration compared to last year is largely down to increased expenditure in the areas of health and social protection in response to Covid-19.
Government expenditure was up €11.4bn, or 23.7%, in the year to the end of November compared to the same period last year.
Cumulative tax receipts are €3.761bn which is down 6.9% on last year.
November is normally the biggest month for tax receipts. However, there were a number of one-off factors last month.
Income tax receipts are down just over €1 billion compared to November 2019, principally because the ‘pay and file’ deadline for the self-employed has been extended.
PAYE receipts, however, are “…holding up remarkably well…” according to the Minister for Finance, Paschal Donohoe, in a statement accompanying today’s figures. Income tax in the year-to-date is running 7.5% behind last year.
In addition to the extension to the pay and file deadline, November’s figures were also affected by the return of €430 million of the €550m set aside in October for the Covid Restrictions Support Scheme. This suggests take up of the scheme has been low.
The Department of Social Protection has also dipped into the Social Insurance Fund to the tune of €900m to fund the Pandemic Unemployment Payment. This improves the Exchequer figure but has no effect on the overall budget deficit recorded over the year.
Corporation tax, which fell unexpectedly in October, recovered to deliver €3.050bn in November. Cumulatively, corporation tax is running at €10.717bn, up 7.1% on last year.
VAT receipts are down 17.7% in the year to the end of November compared to last year, reflecting less money being spent in the economy.
While excise receipts are also down in the year-to-date, they are up 11% in the month of November compared to November last year.
The Department of Finance suggests this may have something to do with fewer people travelling and purchasing duty free or goods like drink and cigarettes abroad.