Irish public finances have started the year in good health with Irish exchequer returns for January 2018 showing that the exchequer recorded a surplus of €1,529m (+4.1% yoy).
January is typically the largest month for VAT receipts and a strong Christmas trading period has been reflected through a record month for VAT receipts of €2,445m, +5.7% (yoy). Income tax revenues also started the year in robust fashion, with receipts of €1,750m collected in January, reflecting an improvement of +6.6% yoy.
On the expenditure side, gross voted current expenditure of €4,807m was recorded in January, up 4.7% yoy, while capital expenditure of €218m remained relatively stagnant from last year (+0.7% yoy). The cost of servicing the national debt declined by 3.5% yoy to €235m in January.
Goodbody Stockbrokers claims the improvement is on the back of an increase in tax revenues, of which €5,019m were recorded (+4.9% yoy), which was partially offset by an increase in total net voted expenditure, which came in at €3,959m in January (+3.7% yoy).
Goodbody Stockbrokers today commented, "Overall, the public finances have displayed a healthy start to the year. As noted in our Q1 2018 Health Check “Fighting Fit”, we expect a modest budget surplus in 2018, for the first time since 2007. As the fiscal space increases, the government has important tradeoffs to weigh up on how to utilise the extra resources. We believe that the fiscal space should be diverted towards capital investment."