Ireland far exceeds forecasts with 2% budget surplus for 2022

DUBLIN (Reuters) -Ireland recorded a budget surplus of around 2% of gross national income in 2022, one of the few expected across the European Union last year and far in excess of the 0.4% projected three months ago, the finance ministry said on Wednesday.

The 5.2-billion-euro surplus represented a turnaround from a deficit of 7 billion euros or 3% of gross national income in 2021, reflecting a fall in spending related to COVID-19 as the pandemic has receded, as well as strong tax revenue growth.

VAT and income tax grew by 21% and 15% year-on-year. Corporate tax receipts, mostly paid by a small number of large foreign-owned multinationals whose European headquarters are in Ireland, jumped by 48% to a record 22.6 billion euros.

The annual corporate tax take stood at just 4 billion euros a decade ago, and the finance ministry raised its estimate for the amount of corporate receipts that may not be repeated in the future to 10.5 billion euros from 9 billion euros in September.

The government said last year that it plans to set aside 6 billion euros of those receipts in a reserve fund by the end of 2023.

($1 = 0.9443 euros)

(Reporting by Padraic HalpinEditing by Mark Heinrich)