Corporation tax represented over 27% of total receipts for 2022

Minister for Finance Michael McGrath said the volume of corporation tax receipts points to a need for a careful policy response from the Government
Corporation tax represented over 27% of total receipts for 2022

Muireann Duffy

Corporation tax totalling €22.6 billion represented 27.5 per cent of the State's total tax receipts for 2020 according to figures released by Revenue.

Last year's corporation tax taking were up 48 per cent on 2021, surpassing VAT as the second-largest tax head.

More than half of last year's total corporation tax receipts were in respect of just 10 companies.

Commenting on the figures, Minister for Finance Michael McGrath said the "extraordinary" growth in receipts and the increasing level of concentration from a smaller number of companies must be carefully handled by the Government.

Mr McGrath explained that the Department of Finance estimates that €24.3 billion will be collected in corporation tax receipts this year, half of which "are windfall in nature and cannot be relied upon in the future".

"We have to avoid the mistake of building up permanent expenditure and taxation commitments on the back of receipts that could prove to be temporary," the Minister warned.

"To make such a mistake would be to expose taxpayers, and the sustainability of our finances, to unnecessary and unacceptable risk.

"A shock to corporate tax receipts would have serious repercussions for the public finances. Even in the absence of a shock, structural changes to the economy mean serious expenditure pressures are building up," he said.

The Minister confirmed plans to establish a scoping paper on future-proofing the State's finances, examining the establishment of a new fund which could be used to cover costs related to the country's ageing population.

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