Figures released by the Department of Finance this evening show that there was an Exchequer deficit of €980m last year, compared with the €1.9 billion deficit forecast in Budget 2003.
The improved figures came about as a result of higher than expected tax receipts and a lower than projected spending figure.
Tax receipts last year increased by 9.6%, compared with an 8% Budget target. Total current spending rose by 6.7% and came in marginally below the Budget target.
Receipts from income tax, VAT and excise duties were lower than projected, but there were higher than expected revenues from capital taxes and stamp duties. Income tax receipts were marginally below target, but stamp duties, at nearly €1.7 billion, increased by around twice as much as expected.
Finance Minister Charlie McCreevy said the reduction in the borrowing requirement meant a lower burden on the Exchequer in the future. But he added that there was a need for continued spending restraint.
Capital spending amounted to just under €5.3 billion, marginally lower than targeted.
56% of the total capital tax take came in the months of November and December. But Department officials have been cautious in their treatment of the figures, suggesting that the revenue from capital taxes may not be sustained next year.
Despite this afternoon's improved figures, the Department is not changing its forecast deficit of €2.8 billion for this year and says the Government will borrow nearly €10 billion in total over the next three years.
