Healthy Exchequer position meets uncertain global backdrop, and looming mid-year risks
The Exchequer enters 2026 in a very healthy place after another record year in 2025. Geopolitical turmoil continues but as of now it does not appear to have had any material impact on the Irish economy. The Exchequer figures will be an indicator to watch closely this year, in order to ascertain whether any negative effects are starting to make themselves felt.
Our view is it will be June at the earliest before any negativity might begin to show up. This is based on very strong goods exports data for 2025, with a substantial year-on-year increase in the figure likely to be confirmed over the coming weeks. This indicates a positive 2025 in profitability terms for large multinationals based here, which will read across into corporation tax receipts in 2026.
However, the goods exports data has been softer towards the back end of 2025 and this trend may continue into this year.
In June, when firms begin making preliminary corporation tax payments for 2026, we will get a strong insight into whether the positive business performances seen last year are being sustained.
The key thing to watch for in the January filing is the VAT figure. This will capture November and December’s VAT payments, giving us a good indication of consumer spending at Christmas. We expect income tax returns to remain solid with the employment picture looking positive. Overall, January tends to be one of the quieter months from an Exchequer perspective and it will be later in the year before we get a clearer picture.
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