DUBLIN (Reuters) - Ireland expects to collect more than 11 billion euros from corporate tax receipts in 2019, significantly higher than the 9.5 billion it had pencilled in at the start of the year, Finance Minister Paschal Donohoe said on Wednesday.
Corporate tax receipts have more than doubled since 2012, mainly boosted by Ireland’s large cluster of multinational firms, and last year hit a record high of 10.4 billion euros which Donohoe’s department until recently expected to moderate.
Instead, the receipts have continued to surge and were 10.6% ahead of the government’s target at the end of October before the largest collection month of the year in November, when around a quarter of all corporate tax returns are made.
“We expect to collect in excess of 11 billion euro in corporate tax receipts, that will be around 19 to 20 percent of all tax that we collect in our country,” Donohoe told Irish national broadcaster RTE.
Ireland took in around 6 billion euros a year via corporate tax during its last economic boom in the mid 2000’s.
The significantly higher outturn during the current upturn, when Ireland’s economy has grown faster than any other in the European Union, comes as the presence of multinationals in the country has also hit record levels.
However, the ability of firms to book profit and park assets like trademarks and patents in low tax countries like Ireland - where they are among the country’s biggest employers - has led to a drive for a global rule book on how and where big internet firms pay tax.
While Donohoe expects corporate tax receipts to grow again next year, he anticipates that the rate of increase will plateau, stabilise and at some point fall as the new rules under consideration are introduced.
The minister flagged on Tuesday that it was conceivable Ireland’s fiscal position for 2019 could be better than the 0.2% budget surplus forecast a month ago as a result of the bumper corporate tax receipts.
Reporting by Padraic Halpin; Editing by Toby Chopra