Unbearable pressure was exerted on this State by our neighbours in Europe to take action unilaterally to close down corporate tax avoidance loopholes such as the Double Irish, upon which time was called in last week’s budget.
The pressure and the Irish retreat it spawned was meant to chasten the State in the world of realpolitik. It would be supremely ironic then and, one imagines, infuriating for Europe if Ireland was to end up benefiting from the palaver.
A report in Le Monde this week suggested that, in light of the budget move, Google is weighing up shuttering its operations in Bermuda, where money that is catapulted out of Ireland using the Double Irish technique remains untaxed.
Separately, over the weekend, it was also reported by the Sunday Independent that Google is considering a €75 million bid to buy the Boland's Mills complex adjacent to its current campus in Dublin's docklands. The report speculated that Google is looking at further substantial expansion in Dublin, as it plans to reorganise its network following the Double Irish closure, and it would like to add Boland's Mills to the €165 million it has already splashed on property in the area.
Google is an obvious contender to buy the Boland’s Mills site, even if sources close to the company say it isn’t working on a bid. It is a huge buiding and Google is not short of space in its current complex. If it were to snap up the Mills, it is highly likely that employee numbers in Dublin would spiral well past 3,000.
Shifting some its operations back to Dublin would allow Google to maximise the benefit of Ireland’s 12.5 per cent corporation tax rate.
If Google does shift even more of its operations to this country in the post Double Irish-world, perhaps Apple, Facebook and other may do the same. That would really get their goats in Berlin, Brussels and Paris.
Now that Europe has learned Ireland will eventually cave in to pressure brought to bear over our tax system, will attention return once more to our 12.5 per cent tax rate?
Corporation tax policy looks set to be a perpetual battleground for this country.
