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US firms make $83bn profits in Ireland

US firms make $83bn profits in Ireland

American multinationals made more profits in Ireland in 2017 than in six of the world’s largest economies combined, according to new official data.

The Bureau of Economic Analysis released its annual report into the activities of American multinationals on Monday and it showed they reported $83bn in profits in the State, more than 30pc of the entire total recorded in the European Union.

The data will reignite the debate over whether Ireland is a tax haven at a time when moves are afoot to rein in profit shifting by companies.

“US firms booked $83 billion in profits in Ireland in 2017, more than in Germany, France, Italy, China, Mexico & India combined,” Professor Gabriel Zucman, one of the world’s leading experts on corporate taxes, wrote on his Twitter feed.

Professor Zucman said the data showed the effective tax rate for these companies here was just 4.3pc.

“Ireland remains the #1 tax haven,” Professor Zucman claimed.

The Government denies that Ireland is a tax haven and says it is working with other countries to amend global tax rules that aim to clamp down on the ability of companies to shift profits by assigning items like intellectual property to subsidiaries in low-tax countries.

The new rules are scheduled to be agreed next year, although countries like France and Britain are to press ahead with sales taxes to ensure that companies pay up in the jurisdictions where they have revenues.

The issue is especially sensitive for Ireland as US multinationals – including the likes of Apple, Google and social media giant Facebook – pay 8 out of every 10 euros the government receives in corporate tax receipts.

These receipts have ballooned in recent years and have allowed the government to balance the budget despite large overspends on health and rising capital spending.

According to analysis from business group Ibec, receipts from company taxes have exceeded estimates by €14.3bn since 2015.

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