Ireland's reliance on foreign multinational taxes grew in 2024

DUBLIN (Reuters) -Foreign multinationals paid a record 88% of all Irish corporate tax last year, with the largest 10 firms accounting for 57% of surging receipts, according to data on Wednesday that highlighted the country's vulnerability to U.S. policy changes.

A jump in corporate tax revenue from 4.6 billion euros ($5.24 billion) in 2014 to 28 billion euros last year, or 29% of all tax collected - even before an extra 11 billion euros of back taxes from Apple is included - has transformed Ireland's public finances into the healthiest in Europe.

However, the huge reliance on the taxes and jobs provided by a cluster of U.S. tech and pharmaceutical multinationals has made it one of the most exposed countries to U.S. President Donald Trump's tariff and tax plans.

Trump has repeatedly singled out Ireland for "luring away" U.S. pharma giants such as Johnson & Johnson and PFE.N with decades of low corporate tax rates, a problem he says he intends to tackle through tariffs. 

Excluding the Apple back taxes, the top 10 companies' share of corporate tax last year returned to the 57% level seen in 2022 after dipping to 52% in 2023, the data from Ireland's Office of the Revenue Commissioners showed.

Foreign firms paid 88% of all corporate tax compared to 84% in 2023. 

The concentration of corporate tax has increased as foreign multinationals "onshored" their valuable intellectual property (IP) assets to Ireland and reported higher profits. The top 10 companies accounted for 24% of corporate tax from 2008 to 2012.

The Irish Fiscal Advisory Council, the country's independent fiscal watchdog, has separately estimated that just three firms accounted for 38% of corporate tax receipts in 2023.

The Revenue Commissioners' data also showed that over half of the corporate tax collected in 2024 was paid by manufacturing and information and communication technology (ICT) firms.

The manufacturing sector has seen the largest growth in the last five years, the tax office added, with pharmaceutical companies largely accounting for a jump to almost 10 billion euros in 2024 from 3 billion euros in 2019.

More than a dozen of the world's biggest drugmakers have manufacturing plants in Ireland.

($1 = 0.8786 euros)

(Reporting by Padraic Halpin; Editing by Sharon Singleton)