THE STATE'S income tax take for the first four months of the year is 3% lower than expected - despite plummeting rates of unemployment and more people returning to work.

The latest Exchequer Returns show total tax receipts of €14.1 billion for January to April - which is around one-third of a billion euro lower than was planned under the Budget.

Income tax has a shortfall of nearly €200 million, while corporation tax - receipts of which are more volatile - has also come in much lower than planned so far.

The shortfall comes despite the CSO reporting earlier that the unemployment rate has fallen yet again, to 6.2 per cent. 

A year ago, unemployment stood at 8.4 per cent - and October's Budget projected that the average rate for 2017 might stand at 7.7%.

The actual rate is now a fifth lower than this, but has not materialised into higher income tax payments.

In all, the State ran a deficit of €2.5 billion between January and April, but the Department of Finance says the underlying position is better than last year when one-off factors are removed.