The results of recent research on the amounts of profit declared in the Republic, and the tax subsequently paid on those profits, should surprise no-one. It has exposed the fact that American transnational corporations made profits of $83 billion (€74 billion) here.
A third of these corporations have their head office here, so they can declare all their global profits in Ireland and avail of the friendly tax policies of the state. While the nominal tax rate is about 12½ per cent, the effective tax take is in the region of 4.8 per cent.
It is estimated that these declared profits have resulted in tax revenue to the Irish exchequer of more than €14 billion since 2015. This means that we are net beneficiaries of global imperial plunder as well as both the savage exploitation of workers in the global south and the super-exploitation of the natural world, which contributes to the destruction of the global environment.
It also means that the Irish state’s revenue is of a very precarious nature, very much dependent on holding on to this tax code as it comes under increasing pressure from more and more countries that either oppose these taxation levels and want to see taxes on corporations increased or are themselves attempting to follow a similar job creation strategy, thereby contributing to the race to the bottom.
The economic development strategy being pursued by the the Irish ruling class can only lead to a precarious financial situation for the state, making it even more vulnerable to the flight of capital as these corporations scour the world for the best deal so as to pay minimum or no tax. It means that precarious employment is increasingly experienced by workers as this state competes for mobile capital investment in globally traded goods and services.
There is no strategy for building a sound industrial base centred on the sustainable use of the natural world and our educated and skilled work force. As with all things under capitalism, maximum profits are the order of the day. We know from experience that when government finances decrease it is workers, pensioners, the sick and children who pay the price.
