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Concern regarding the estimated budget surplus could begin if this trend continues in to November. Alamy Stock Photo

Corporation tax receipts fall by €1 billion in October, declining for a third consecutive month

In total, the state collected €5.1 billion in revenue in October.

CORPORATION TAX RECEIPTS fell by 45% in October, amounting to a loss of over €1 billion when compared to the same month last year.

The state’s fiscal monitor for October shows that the government collected €1.3 billion in corporation tax last month.

This is the third consecutive month in which receipts for the tax have declined, when compared to the same month last year.

The monitor says this continuing decline underlines the volatility in the tax and reflects the “weakness” of Irish exports this year. The monitor adds that this weakness has been particularly seen in the pharmaceutical sector.

So far this year, the receipts from the tax – seen as a major support for the economy and an attraction for multinationals – have collected a total of €15.7 billion, €400 million less than the same period last year.

Finance minister Michael McGrath said this month’s report from the department presents a “mixed picture” of public finances.

McGrath suggests the continued decline reflects the importance of the state’s fiscal strategy not to be reliant on corporation tax receipts, as they have become “windfall in nature”.

The minister used the volatility of these receipts to justify the state’s continued stance not to rely on budgetary surpluses and instead look towards investment schemes, such as the Future Ireland Fund and the Infrastructure, Climate and Nature Fund announced in the budget last month.

The state plans to invest €100 billion into these funds to “future proof” the economy, instead of being solely reliant on what’s becoming a volatile form of public revenue.

In total, the state collected €5.1 billion in revenue in October – another €1 billion loss when compared to the same month last year.

Although, €66.5 billion has been collected in total so far this year, which is up €2.5 billion compared to last year that the department says is “driven primarily by income tax and VAT”.

Peter Vale, a Tax partner with Grant Thornton, described the figures as “stark” and suggested the trend could have a “significant impact” on the estimated budget surplus if it were to continue into November.

Vale added that the fall off in receipts reflect the evolving global landscape as “fundamentally corporation tax receipts are lower due to weaker expected profits in some of the largest multinational groups based here”.

VAT receipts now total €17 billion, which the department has suggested is propping up the current revenue. October is a non-VAT due month, leading to a €200 million receipt for the period.

Compared to the same period last year, VAT receipts are 10% higher despite rising costs that Irish consumers are facing.

Vale says the revenue collected from this tax is “levelling off”, reflecting these increased costs but noted the resilience of the Irish consumer base as a cause of the higher rate that has been collected during the first ten months of this year.

An Exchequer deficit of €900 million was recorded at the end of October by the department, representing a decline of over €8 billion on the surplus recorded in the same period last year.

The Department of Finance said this deficit is “driven by a number of factors” including increased public expenditure, reduced non-tax revenue and the transfer earlier this year of €4 billion to the National Reserve Fund.

Minister for Public Expenditure Paschal Donohoe highlighted these public investments today when commenting on the report from the department. Donohoe said the money is being used to support services, infrastructure and living standards.

Donohoe said: “The Government’s planned and balanced approach to fiscal policy has allowed us to manage these priorities while providing supports for those who most need it in the face of emerging external challenges.”

The total state expenditure for the first 10 months of the year has increased by €5.6 billion, compared to the same period last year, amounting to a total of €72.2 billion as of the end of October.

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    Mute another one? what's going on is the semi state sec
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    Nov 3rd 2023, 6:34 PM

    For perspective, corporate tax in 2022 was €24.6B, the highest take ever and €17.5b in 2021…….in 2019 it was €12.3B. 2018 it was €11.4B. It’s not doom and gloom because its a few billion below last years. Just a bumper few years recently well above the norm that we were accustomed to pre-pandemic……. Stop the scaremongering and report the full picture.

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    Mute Kevin Kerr
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    Nov 3rd 2023, 7:33 PM

    @another one? what’s going on is the semi state sec: Indeed. The big picture is that corporation tax receipts are volatile in nature. So when people talk of budget surpluses and tax cuts, they should consider the role that corp tax has had in this surplus in the last year.

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    Nov 3rd 2023, 9:20 PM

    @SYaxJ2Ts: People should also understand that, bumper corporate tax aside, the govt have had bumper income tax and VAT takes as well!!! In 2019 income tax was €25.6b and VAT was €20.9b. Then in 2022 income tax was €33.6B and VAT was €26.7B…… that’s a big increase. That’s €8B more from our pockets via income tax and more from VAT with the higher cost of things….. And the tax measures from the budget only cost €1.1b….. how sickening is that! They could have done a lot more for us during this massive cost of living crisis. Inflation is up nearly 20% since the start of 2021.

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    Mute Shom Whelan
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    Nov 3rd 2023, 9:46 PM

    @SYaxJ2Ts: it’s looking bleak

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    Mute Kevin Kerr
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    Nov 3rd 2023, 9:56 PM

    @another one? what’s going on is the semi state sec: that increase isn’t due to any increase in tax rates, it’s from comparatively higher workforce numbers – less unemployed and a bigger pool of workers. So your 8 BN increase, tho very welcome, comes with a hefty cost.

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    Nov 3rd 2023, 10:35 PM

    @SYaxJ2Ts: Yes I’m very aware that we didn’t get a tax increase. I didn’t insinuate that we did! In fact there has been a widening of bands and an increase to tax credits between 2019 and 2022, and an increase of employment of about 9% between the years…….The point is that they are taking in so much more income tax (30% more) and VAT now but all they gave back in the budget is 1.1B………they could have given back so much more! Let’s see what it comes out as for 2023. I’ll bet it’s a bigger take than the 2022 take with the increases to wages for those lucky enough to get it!

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    Mute Kevin Kerr
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    Nov 3rd 2023, 10:39 PM

    @another one? what’s going on is the semi state sec: you insinuated that the 8bn extra revenue came without a cost. It didn’t, so if we’re comparing the 8b extra income to the 1.1 budget cost, we need to consider the cost associated with the extra 8bn. That’s my point

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    Mute another one? what's going on is the semi state sec
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    Nov 3rd 2023, 10:41 PM

    @SYaxJ2Ts: From the Examiner today “Income tax revenues last month brought in €2.6bn, only slightly higher than October 2022, but which means over the first 10 months, income taxes brought in €25.7bn, or €1.8bn more than collected in the same period last year.”….. so if next year runs the same as this year the govt won’t even feel the tax measures in the budget. They’ll still make more than 2022, the biggest income tax take ever. But it looks like 2023 will soon take that accolade….. Thanks lads! Thanks for helping the people of this country during the crisis!!! We are still being taxed like they’re running austerity budgets!

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    Mute Kevin Kerr
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    Nov 3rd 2023, 10:50 PM

    @another one? what’s going on is the semi state sec: ffs I’m not disputing your increase in revenue numbers. All I’m saying is that 1 extra revenue does not equal 1 extra net income, particularly if the extra revenue comes from volume rather than rate

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    Nov 3rd 2023, 11:30 PM

    @SYaxJ2Ts: FFS…..and all I’m saying is they could have given us more tax relief in the budget given their massive income tax revenue, which will be bigger this year, and probably bigger next!

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    Mute Kevin Kerr
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    Nov 3rd 2023, 11:39 PM

    @another one? what’s going on is the semi state sec: Heart

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    Mute
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    Nov 3rd 2023, 6:18 PM

    Recession is coming, leo is well aware , we will have new goverment in 12 months

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    Mute Fintan Stack
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    Nov 3rd 2023, 6:34 PM

    @: this is the impact of the recession last year. So We’re in a recession, not waiting for one. Obviously the government are living the dream while everyone else pays.

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    Mute Shom Whelan
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    Nov 3rd 2023, 6:58 PM

    Good luck

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    Mute Shom Whelan
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    Nov 3rd 2023, 6:59 PM

    @Fintan Stack: which post office do you collect your dole money from, Fintan?

    22
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    Mute Mick Duvanny
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    Nov 3rd 2023, 7:02 PM

    @Fintan Stack: What recession are you talking about?

    16
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    Mute Shom Whelan
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    Nov 3rd 2023, 7:03 PM

    Will you stop trying to be someone else?

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    Mute Geoff Bateman
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    Nov 3rd 2023, 8:10 PM

    Recession is already here

    20
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    Mute Chutes
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    Nov 3rd 2023, 8:23 PM

    @Geoff Bateman: It’s only in it’s earliest stages.

    14
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    Mute Kevin Kerr
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    Nov 3rd 2023, 8:51 PM

    @Chutes: by what measure?

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    Mute Chutes
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    Nov 3rd 2023, 10:16 PM

    @SYaxJ2Ts: Mine.

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    Mute Kevin Kerr
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    Nov 3rd 2023, 10:18 PM

    @Chutes: haha

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    Mute Fintan Stack
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    Nov 4th 2023, 7:47 PM

    @Shom Whelan: all of them

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    Mute Chris O'Brien
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    Nov 3rd 2023, 6:39 PM

    I remember saying about a year ago that basing our economy on being a tax haven for multinationals was dodgy.

    No one seems to remember how quickly they abandoned us in the 80s.

    We had decades when we could’ve invested all of this into domestic businesses, freeing ourselves to some degree from this trap. But no.

    Turns out we’re incapable of planning, or learning from the past.

    Go figure.

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    Mute Spanner
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    Nov 3rd 2023, 6:55 PM

    @Chris O’Brien: we are indeed a short sighted nation and never learn. I fear the usc will return in some shape due to this fall in revenue and they have begun to remind people that taxes are due for vacant houses et. Doomed Were doomed as private frasier used to say

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    Mute Kevin Kerr
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    Nov 3rd 2023, 7:18 PM

    @Chris O’Brien: Our woes in the 1980′s were not caused by multi-nationals “abandoning us”. Multi-nationals were a relatively tiny percentage of the overall economy at that time. We were a back water then, and multi-nationals only started investing in the 1990′s in serious numbers.

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    Mute Murro
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    Nov 3rd 2023, 6:26 PM

    Stop the slaughter in Gaza

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    Mute Paul Fahey
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    Nov 3rd 2023, 7:24 PM

    @Murro: how about just stop the slaughter, any slaughter. Israel; Gaza; Syria; Yemen; Ukraine etc etc.

    136
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    Mute Shom Whelan
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    Nov 3rd 2023, 7:55 PM

    @Murro: stop the world and let me off

    37
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    Mute Paul Maguire
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    Nov 3rd 2023, 6:35 PM

    They took in one Billion euro less in corporation tax however they actually took in two and a half billion Euros more than last year

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    Nov 3rd 2023, 8:58 PM

    5 billion for Ukrainians

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    Mute Shom Whelan
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    Nov 3rd 2023, 9:49 PM

    People on the dole should be given food vouchers instead of money, that way they won’t have money to spend money on cans and cigarettes

    71
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    Mute Siobhan Ryan
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    Nov 3rd 2023, 7:33 PM

    The total state expenditure for the first 10 months of this year has increased by 5.6 billion – this cannot be sustained.

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    Mute Adrian Kehoe
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    Nov 3rd 2023, 7:39 PM

    @Siobhan Ryan: And the Health department looking for a further 1.5 billion, something rotten in the state of Denmark, completely unsustainable in any sense .

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    Mute Chutes
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    Nov 3rd 2023, 8:26 PM

    @Adrian Kehoe: Tbf, there are already AI systems that could fill most of the administrative tasks in many departments.

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    Mute Adrian Kehoe
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    Nov 3rd 2023, 8:57 PM

    @Chutes: I fully agree with that , but it would take from the cushy numbers for lots of connected individuals in higher management roles .

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    Mute Paddy C
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    Nov 3rd 2023, 9:00 PM

    @Siobhan Ryan: not at all our government thinks strongly about such things and plans and projects future outcomes,opening the gates letting thousands in without a moment’s thought to possible outcomes for those and us,high housing waiting lists, homelessness,overpacked hotels,overpacked schools,huge expenditure on social welfare,health etc all on the dependence of tax from multinational companies here, if any pull out or recession hits if expenditure is higher now one wonders what will indeed happen if one hits but wait that’s what we surely have a government for to at least contemplate such possible probable outcomes so you must indeed be wrong sir for they don’t dare make foolish decisions looking at the obvious facts they are educated professionals doing fantastic work here and abroad

    12
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    Mute NotMyIreland
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    Nov 4th 2023, 12:52 AM

    @Paddy C: . ,
    That’s a full stop and a comma, you should consider using them some time!

    7
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    Mute Paddy C
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    Nov 4th 2023, 10:19 AM

    @NotMyIreland: thank you I shall endeavour to do so

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    Mute Proinnsias O'Dubhlaoich
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    Nov 3rd 2023, 8:54 PM

    Well when it all falls apart at least they have their own private army they brought in under the fake refugee and international protection racket to keep us from doing anything about it. Our being member of the EU cabal is eventually going to be a lesson this country will never forget. Talk about there’s no such thing as a free lunch, the price we are paying and will pay into the future will be absolutely tragic.

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    Mute Chris Thaunton
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    Nov 3rd 2023, 6:33 PM

    If I go to live in Vietnam and stay there for a few years and get a dual citizenship, will I be a Vietnamese man or a Vietnamese citizen?

    58
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    Mute Shom Whelan
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    Nov 3rd 2023, 7:07 PM

    @Chris Thaunton: I don’t know, but me so hawny

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    Mute Shom Whelan
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    Nov 3rd 2023, 9:37 PM

    One parent family payment must end, I am aware of a woman bring a man into her home and the man leaves in the morning

    43
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    Mute Rebel Rebel
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    Nov 3rd 2023, 8:54 PM

    Cut the social welfare payments for the lazy folk..for the ones that have no insintive to work….sure we’ll be grand.

    59
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    Mute Brian molloy
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    Nov 3rd 2023, 9:08 PM

    Lower tax returns still won’t stop the money grabbing whingers in the public service from wanting pay increases

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    Nov 3rd 2023, 9:43 PM

    @Brian molloy: and they will get it too. Parasitic spongers

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    Mute WillThisDoReviews
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    Nov 4th 2023, 7:04 PM

    @Brian molloy: You do realise that we’re still owed money from when the ar*e-ra*ed us during the last recession. Any ‘increases’ we ask for is merely a Pay Restoration.

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    Mute Happy As Larry
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    Nov 3rd 2023, 6:44 PM

    There is about the same amount of civilians dead in both Ukraine and Palestinian conflicts

    28
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    Mute Shom Whelan
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    Nov 3rd 2023, 6:59 PM

    @Happy As Larry: how awful

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    Mute C kirby
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    Nov 3rd 2023, 7:21 PM

    @Shom Whelan: Wait until the big corporations move to Ukraine after the proxy war . With special low rate corporate tax rate to help the big investment companies buying up the land

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    Mute Paul Fahey
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    Nov 3rd 2023, 7:26 PM

    @C kirby: don’t think we would have any right to complain about low corporate tax rates. We have gorged on the piracy with willful abandon ourselves and despite all the money still no real economy of our own.

    28
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    Mute Shom Whelan
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    Nov 3rd 2023, 8:00 PM

    @Paul Fahey: yeah, once big names like Pfizer pack up and leave, we are screwed

    18
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    Mute Happy As Larry
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    Nov 3rd 2023, 9:26 PM

    @Shom Whelan: it’s horrific imo shame on both Israel and russia

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    Mute Corey Dalton
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    Nov 3rd 2023, 10:18 PM

    @Happy As Larry: True, but Israel has inflicted this horror in just a few weeks rather than nearly two years. And on a population that is just 5% the size of Ukraines.

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    Mute Happy As Larry
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    Nov 4th 2023, 7:13 AM

    @Corey Dalton: yes I 100 per cent agree

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    Mute Hector turtlehead
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    Nov 3rd 2023, 8:39 PM

    Successful investors invest in different commodities due to risk.
    Ireland relies too much on corporation tax from foreign companies.
    They move out, we suffer.

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    Mute MTB Mayo
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    Nov 3rd 2023, 10:00 PM

    “That money was just resting in my account”

    17
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    Mute James Carolan
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    Nov 3rd 2023, 7:36 PM

    Maybe the government need to start focusing on the Johnny CASH club with a bit more intent.

    14
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    Mute Michael Power
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    Nov 3rd 2023, 8:24 PM

    “ Corporation tax receipts in 2023 to date are now trailing the figure recorded in the first 10 months of last year. At €15.7 billion, they are €435 million or 2.7 per cent lower than in the same period in 2022.”

    2.7% is nothing. November is the important month for CT.

    Don’t worry, Lefties.

    11
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    Mute Shom Whelan
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    Nov 3rd 2023, 9:54 PM

    The man on the right of that photo will be Pearse Doherty after the the next election, the man on the left will be in opposition, the man on the right will be minister for public expenditure and reform

    8
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