The State’s fiscal watchdog has estimated that close to half of all Corporation Tax collected by the Exchequer comes from just three multinational firms.
In 2024, these major companies contributed approximately €13 billion, representing 46% of total receipts, according to the Irish Fiscal Advisory Council, reports RTE.
Although the organisation did not publicly identify the three firms, they are understood to be Apple, Microsoft and pharmaceutical giant Eli Lilly.
IFAC said that Corporation Tax revenue nearly doubled between 2021 and 2024, even when excluding the back taxes previously paid by Apple, reports RTE.
The council stated that this significant growth was mainly driven by higher contributions from the three largest companies.
It is estimated that the two tech firms, Apple and Microsoft, together paid almost 40% of overall Corporation Tax receipts, reports RTE.
IFAC economist Brian Cronin said the “research highlights how reliant Ireland’s Corporation Tax has become on just three companies”.
“These companies continue to perform strongly, but their profits and the taxes they pay remain subject to significant uncertainty,
“As a result, corporation tax receipts could be substantially higher or lower than current levels in the medium term,” he added, reports RTE.
Profits at Apple and Microsoft are projected to rise further, supported by developments in artificial intelligence and increasing demand for their products and services.
Within the pharmaceutical industry, Eli Lilly is expected to maintain strong performance due to surging demand for weight-loss and diabetes treatments, reports RTE.
IFAC Chair Seamus Coffey said the Government must be in a position to fund public services sustainably, rather than depending on periods when “booming tax revenues” are flowing.
He told RTÉ’s Morning Ireland that relying on a small number of companies is a risk.
“You’re looking at providing Government services on a sustainable basis, not just when this money is coming in,” reports RTE.
“There are clear priorities that the Government has identified that it wants to target, and there’s no question that it can do that, but it should be able to do so on the basis of sustainable revenue, tax revenues that are there – regardless of the performance of two or three companies, or boardroom decisions of two or three companies, or a social media post from the President of the United States,” reports RTE.
“So when it comes to capital spending on housing, when it comes to investment in health, education etc, these are things governments should be doing all the time, not just when these booming tax revenues are coming in,” said Mr Coffey, who is a economics lecturer at University College Cork,” reports RTE.
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