An Exchequer surplus of €2.5 billion was expected for 2020. That was before the pandemic struck. With an estimated overall Government deficit of €19 billion, the December Exchequer Returns provide us with the full picture in 2020, a year where tax revenues coped well, but expenditure soared.

Tax Revenues fell by 3.6 percent year on year, benefitting from a strong performance in corporation tax receipts at the beginning of 2020, as well as stable income and corporation tax receipts throughout the year. This compensated for sharp declines in VAT and excise receipts. Corporation tax was the only major tax head to record an increase in 2020, up 9 percent on the previous year.

A summary of December Exchequer returns is as follows:

• Income tax receipts were down €224 million, or 1 percent on 2019, a smaller than expected fall due to strong PAYE and self-employed returns;
• VAT receipts finished the year €2.7 billion, or 18 percent less than 2019, as public health restrictions impacted consumer spending;
• Similarly, excise returns were down €500 million, or 8 percent on 2019;
• Total net voted expenditure in 2020 was €67.8 billion. This represents a 25 percent, or €13.7 billion increase on 2019;

The Minister for Finance, Paschal Donohoe TD, and the Minister for Public Expenditure and Reform, Michael McGrath TD, provided their views on the 2020 Exchequer results in a Department of Finance press release. The Fiscal Monitor for December 2020 provides details of the December Exchequer results. The Department of Finance has also published a presentation on End-2020 Exchequer Returns.