(Bloomberg) -- About a third of Ireland’s corporate tax revenues were paid by three corporate groups in 2021, according to new research which indicates the country’s tax receipts are even more concentrated than previously thought.
Irish corporation tax receipts have swelled in recent years with the bulk of revenues increasingly received from a small number of large foreign-owned multinationals, predominantly in the technology and pharma sectors, a report by the Irish Fiscal Advisory Council found.
Three firms paid €5.2 billion in 2021, about a third of the total corporation tax received by the state, with the share close to that over the four preceding years, it said. The corresponding figure for 2022 is estimated to be even higher.
The research suggests the pool of large taxpayers is even smaller than previously estimated, highlighting the risk of over-reliance on handful of companies. The firms are not identified but multinational corporations with a significant presence in Ireland include Apple Inc., Microsoft Corp., Pfizer Inc., Intel Corp., Alphabet Inc. and Meta Platforms Inc.
Recent figures published by the Revenue Commissioners showed that 57% of corporation taxes were paid by just 10 companies in 2022.
The warning comes amid mass job cuts in the technology sector and ahead of a global overhaul of corporate tax rules which is expected to reduce Ireland’s tax take.
Finance Minister Michael McGrath last month announced plans to set up a long-term investment fund into which excess corporation tax receipts will be channeled to avoid allocating much of what may be transitory revenue on current spending and help pay for future aging and climate change costs.
How much will be stashed away in this fund each year has yet to be determined, but if it hits €90 billion by 2030, can earn a strong return and is reinvested to 2035, its total value could reach €142 billion.
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