Corporation tax will undershoot Government targets this year by €750m, according to the White Paper published by the Department of Finance.
The report, published last night, sets out the position of the public finances before any decisions are taken in next week's Budget.
The undershoot in corporation tax revenues comes against the backdrop of a fall in exports this year in some key sectors of the pharmaceutical industry.
The Department of Finance expects this to reduce corporation tax targets this year by €750m.
However, better-than-expected income tax returns, mean the reduction in overall tax revenue is expected to be around €500m.
This will reduce the expected surplus this year to €9.6bn.
Next year’s surplus has been reduced to €12.54bn, as what had been earmarked as temporary and contingency spending on housing people displaced from Ukraine, is expected to be spent.
This year’s projected surplus will be further reduced by whatever cost of living supports the Government announces next week.
In a statement, Minister for Finance Michael McGrath said: "We are maintaining our Budgetary parameters."
He also said he will unveil a plan on Tuesday setting out what the Government intends to do with "...the projected surpluses for the years ahead".
Mr McGrath said: "This plan will involve making the financial future of the country and our people safer, and ensuring we can invest in infrastructure and climate measures through the economic cycle."
The figures show overall tax revenue this year is expected to be €88.35bn and €93.2bn next year.
In April's Stability Programme Update (SPU), the Government expected to collect €88.9bn this year and €94.4bn next year.
Corporation tax this year is now expected to be €23.6bn, compared to an expected €24.3bn.
Next year, it is expected to recover to €24.5bn compared to €25bn in the SPU.
These are still huge amounts of corporation tax compared to previous years. As recently as 2020, €11.8bn was collected in corporation tax.
The White Paper also shows that net current spending is ahead of expectations by approximately €200m.
