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Dáil
‹ Ceisteanna ar Pholasaí nó ar Reachtaíocht - Questions on Policy or Legislation

Windfall corporation tax management

Summary

Deputy Timmins urges ring-fencing windfall corporation-tax receipts instead of using them for current spending. Minister Chambers points to expenditure-growth controls, efficiency measures and the Future Ireland and infrastructure funds.

As the Minister will know, we will take in approximately €17.5 billion in windfall corporation taxes this year. Our budget surplus of €8 billion looks great but without these windfall corporation taxes, our finances would be in deficit to the tune of €8 billion or €9 billion, which is concerning. It is moving in the wrong direction. I know the Minister is aware of this. Would he consider doing something like what is done in Norway, namely ring-fencing these windfall corporation taxes, or a large proportion of them, and not allowing them to be used for current expenditure? Only what is earned from the fund in which they are held would be used for current expenditure. This would be a way of being fiscally prudent and planning for our future.

Comment on this

The Deputy and I have engaged at meetings of Oireachtas committees on following through on that and moderating the growth rate of current expenditure from 9%, the average over the past five years, to 6%, the rate we have set in the medium-term fiscal and structural plan. Part of driving that involves ensuring we are much more effective in driving efficiencies in the existing base spend, achieving much better value for money for taxpayers and continuing to commit to the two structural funds we have established, namely the Future Ireland Fund and the Infrastructure, Climate and Nature Fund, which have been welcomed by international markets. We are due to have €25 billion set aside by the end of this year. That will grow to a figure in excess of €30 billion next year. That provides a strong anchor of fiscal discipline whereby, by means of legislation, we are putting a lot of the windfall receipts aside. On the Deputy's point as to whether we should put even more aside if there are further windfall receipts, what anchors us in moderating day-to-day expenditure, which we are committing to, is our medium-term structural and fiscal plan.

Comment on this