The Government expects the Sugar Sweetened Drinks Tax, which was introduced last year, to generate €35m in revenue this year.
In response to a parliamentary question from Fianna Fáil Finance Spokesperson Michael McGrath, Minister for Finance Paschal Donohoe also said the sugar tax brought in just €16.5m in 2018 despite a forecast of €30m.
Mr Donohoe said this estimate assumed a start date of 1 April 2018 but the tax did not kick in until the beginning of May, which impacted on receipts.
He noted that as the sugar tax was new "forecasting the level of receipts in advance was challenging".
The minister added that the primary purpose of the sugar tax is to "change behaviour rather than to raise revenue.
"As such, the early indications are that the tax is working effectively in reducing the volume of sugar sweetened drinks being consumed in Ireland".
Mr McGrath welcomed the fact that many companies "have changed their products and have reduced the sugar content of a wide of range of drinks" in response to the new tax.
However, he added it is "concerning that the Government’s estimate of how much the tax would bring in has proven to be so wide of the mark and I think it would be important to establish whether this is as a result of consumer behaviour changing more than was expected as a result of this tax coming in".