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THE LATEST EXCHEQUER figures for the first two months of 2012 have shown a deficit of €2.072 billion, up from the €1.945 billion that was reported for the same period in 2011.
The Department of Finance figures released this afternoon show that tax revenues for the first two months of the year are more than €1.05 billion ahead of the same period last year at €5.892 billion compared to €4.840 billion – a rise of nearly 22 per cent.
Tax revenues were 12.5 per cent ahead of expectations or €656 million more than the State was expecting.
The Department of Finance said that the figures were somewhat skewed by the fact that corporation tax receipts due for December – around €250 million – did not arrive until January, inflating the figure for that month and not forming part of the Budget 2012 estimates.
Income tax was also up by nearly 33 per cent – €633 million – compared to the same time last year, and 12.5 per cent ahead of the targeted €289 million.
This was due to the technical reclassification of receipts from employers which they had previously returned as part of their PRSI obligations.
VAT returns and excise duties performed close to expectations with the Department saying they performed close to expectations for the year and were marginally up in year-on-year terms.
Capital gains tax is running €87 million ahead of the same period last year.
Total net expenditure at the end of February was at nearly €7.5 billion, up by 6.8 per cent and 4 per cent ahead of expectations but this was attributed to the income tax-PRSI reclassification issue.
Day-to-day expenditure was at €7.16 billion at the end opf last month, up 7.4 per cent on last year and 3.8 per cent ahead of expectations, again due to the income tax-PRSI reclassification issue.
The cost of servicing the debt so far this year was €891 million at the end of February, up from €626 million in the two months to the end of February last year, reflecting the country’s growing debt burden.
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“growing debt burden” , I thought the bail out and the austerity measures were supposed to reduce the debt burden. When can we except to see a turnaround.?
The circumstances around Irelands recent boom & bust were understood and explained by an Irish economist around 300 years ago.
Richard Cantillon explained how artificial increases in money supply drove up prices resulting in a boom. Ultimately, the boom leads to a crash where those areas of the economy that became bloated during the boom must rebalance and shrink back down to the size they would have been without a boom.
This is happening in areas like construction/property but not in other areas like banking & the public sector. Until this happens we will not return to growth.
Cantillon knew this because he was at the centre of a very similar crash 300 years ago.
http://www.theasiamag.com/cheat-sheet/the-cantillon-effect-explains-property-prices
Michael, with all due respect, how could borrowing more ever reduce debt?
The purpose of the bailout is to give us time to shrink the deficit. Then we get to pay back all the loans in easy instalments over the next 120 years.
Personally, I favour doing an Iceland on it. Might be VERY ugly for a few years, but our grandchildren would thank us for it…
I suspect Jim is correct.
Don’t hold your breath Micheal waiting for the turnaround – the only turnaround(s) are the u-turns taken by the Gov…………..
But sure never mind – Enda signed us up to the Fiscal treaty today – sure that’ll sort everything out (and yes my tone is heavy with sarcasm & irony)
Michael F
Please don’t believe everything the government is telling us .
They have told us nothing but lies ,and u turns . Listen to
your own instincts.
Michael F
Please don’t believe everything the government is telling us .
They have told us nothing but lies ,and u turns . Listen to
your own instincts.
A turnaround … Never ! If we don’t change the way we do things.
Reduce taxes , increase jobs , and rely on ourselves.
Don’t panic baldy’s on the case and he’s got help from gimpy howlin and the rest of the gombeens. Phew what a relief!
Daft.ie are owned by journal.ie…..just to let you all know.
God’s horse. Baldy is on the case? Heartless comment considering the week the man has had. In relation to Irelands fiscal difficulties, what are your suggestions?no cynical replies please.
It’s not a personal attack at all; I’m sure he’s a decent enough man and certainly he’s had a tough personal time over a long period of time. My critique is on his performance in Govt and the spin and horseshit he’s want to bestow on the public. As for alternatives, have you been living on mars? or just been so blinded by the established rhetoric so pervasively eshewed Baldy and co?
@God’s
didnt aswer question
That’s 2 billion a month we’d have to find from somewhere if we defaulted. Now that’s real austerity
you can call out any number you like we are still fcuked and will be fcuked for a long time
“The cost of servicing the debt was €891 million at the end of February, up from €626 million at the end of February last year, reflecting the country’s growing debt burden.”
This is a meaningless statement. If you want to make serious commentary on such matters you need to be precise.
According to the ESRI interest on our national debt costs about €5-€6 billion annually.
What is this €891/€626 million? Is it the interest paid in February 2012 compared to 2011?
As usual Business Etc published this sort of rubbish without attribution.
Hi Matt,
Thanks for your comment and a good point. The sentence has now been changed so as that it should be more clearer what these two figures refer to. Sorry you feel the quality of Business ETC is ‘rubbish’, please feel free to email in your suggestions to feedback@thejournal.ie.
Best,
Hugh
Not sure what you mean.i asked for your alternative suggestions? there isn’t a person who hasn’t suffered over the last few years. Alot of people were greedy, and were all paying for it. My generation will pay the most, which is quite sobering. people around the country saw wealth (acquired or earned) and wanted a piece, be it taking on loans themselves, tax breaks, welfare increases etc. This was aided by an outrageous property bubble which was given steroids by cheap European capital.
While a government will never be popular in a downturn, there has been some good. The IDA has won alot of employment for various regions in the last 12-18 months, while initiatives such as jobbridge and fsi careerstart have helped people get upskilled, a career change. Some have even attained full time employment (myself as an example, a masters graduate who paid college fees for three of five years). This work has largely been done by the current government and to a much lesser extent the final months of the previous one.
The fact were an open economy is something the government can’t do a whole lot about.
I dont believe everything im told(all the above has been from personal experience), but i do have a great faith in the republic and its people, and i think well come out the other end stronger. Have you any alternative suggestions gods horse to improve the Financial situation?
Morgan
Don’t forget Kevin Cardiff is not working in dept of Finance
anymore ,that in itself is a bonus in so far as figures / numbers
are where they should be.
I wonder if these reclassifications are covering non performance. They would never to such a thing would they?
The country is broke and Dublin city council is spending like their is no tomorrow on all sorts of projects. South Dublin Council is also spending a huge amount on luxury items like new signs and road resurfacing when we can’t afford special needs assistants and some people are hungry and have no gas or light ! Yet the priveliged spend taxpayers money on luxuries – stop it now as the oy reason they are spending is to keep their budget for next year. Sack the people who do this and tear up their contracts. Especially the city manager.
Yes Hugh, that is definitely “more clearer”, but do you need the “more”?
You should have taken care to explain that in the first place.
Sloppy economic journalism, we do not need.
All comments on ‘sloppy economic journalism’ can be sent to feedback@thejournal.ie. Thanks.
Almost €6,000,000,000 in 2 months, thats €3,000,000,000 a month. Tax returns, no other income included. Simply please, how can we not run (including servicing national debt) a country the size of ours on this amount ?
Why to feedback@thejournal.ie? I just posted them here.
Does “feedback@thejournal.ie” not read it’s own site?
If you believe in competition, you should be watching your rear!
It’s a means by which you can provide general feedback about the site as opposed to specific feedback.
have your say