Department of Finance "flying blind" and still unsure why Ireland's tax take is so high

The department has claimed they can't fully explain why business taxes have surged

Department of Finance, tax, corporation tax, business

Peter Morrison / AP

The Secretary General of the Department of Finance, Derek Moran, has acknowledged the Department does not have any “real time” information about the reasons for the recent massive surge in corporation tax revenue.

"Consequently, the Department is flying blind on that one," he told the Oireachtas Public Accounts Committee.

These comments come days after it was confirmed that the exchequer tax take so far this year is €3bn more than it was expected to be.

In isolation, corporation tax was €2.3bn more than expected - it made up €6.3bn of the overall €42bn that was taken in during 2015.

"It is going to take us some time to drill down into this," he said, as the Department is still unsure as to what has led to the tax takings being so far above expectations.

His colleague, the department’s chief economist, John McCarthy, confirmed that "a significant part of the overshoot is down to a very small number of firms."

He added that there had been a broadly-based increase in employment in the multinational sector, but the profit share of the sector had risen faster than the wage share.

In a separate session, Fiscal Advisory Council chair John McHale told the Oireachtas Finance Committee that given the "limited understanding" that we have surrounding why the tax take was so high, he believes that the money should not be used to fund increases in spending.