The first quarter of 2026 delivered a solid and broadly reassuring performance for the exchequer, but it is important to view this in the context of a record 2025. While there was an air of optimism in the government’s recent spring economic statement, there was also a health warning as it is forecasted that we will record a €1.2bn exchequer deficit for 2026, which provides early indications of the impacts of recent global headwinds on the Irish economy.
It’s likely that this week’s announcement will reinforce the overarching message from the Spring Economic Statement.
While the State’s overall fiscal position remains strong, the underlying picture is more nuanced. We expect the figures to show continued resilience in revenues, but also to highlight ongoing pressures within the day-to-day Exchequer balance.
April isn’t a VAT month, and it is traditionally quiet for corporate receipts, but we expect income receipts to be stable in line with the continued resiliency of the labour market.
Even against a backdrop of record-breaking surpluses in recent times, the exchequer position may appear tighter, underlining the Government’s recent emphasis on spending discipline and the need for trade-offs ahead of Budget 2027. It remains our view that June will be the first key milestone in the 2026 fiscal calendar, when preliminary corporation tax payments for 2026 and the first Pillar Two top-up tax payments will be made.
Related content
