Michael McGrath (Cork South Central, Fianna Fail)
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The receipts we are collecting constitute real money. We welcome that there is buoyancy in relation to corporation tax receipts but, at the same time, we cannot ignore the underlying trend. The growth has been truly extraordinary. In 2011, we collected about €4 billion. Last year it was €22.6 billion. This year we believe it will exceed €24 billion. When the officials in my Department prepare a paper de-risking the public finances in association with the Revenue Commissioners, they provide an estimate of what they believe to be windfall in nature. I have to take that on board. It would be a serious risk to the stability of the public finances if we were to use those potentially temporary receipts to make permanent expenditure commitments, so we will not be doing that. In both the fiscal monitor and the SPU, we publish the underlying general Government balance, excluding the windfall corporate tax receipts. Those data are published and are there for all to see. We are not saying that these receipts are going to fall away overnight. However, there is certainly a risk, given the windfall nature of these receipts. The Deputy will see we have made projections out to 2026 in the context of the fiscal horizon – I think it is on page 33 – and we are showing what we believe will be continued growth in corporation tax receipts over that period of time, although he will see it is largely flat between 2024 and 2025. That is when we believe that the impact of the OECD base erosion and profit shifting, BEPS, project will kick in. It all underlines the importance of being careful and cautious with these receipts. We do not believe they will last forever. We will have to put receipts away to meet costs that we know are coming our way. That is why setting up this long-term reserve fund is an important body of work that this Government and this Oireachtas need to complete.