Just three firms now pay 46pc of all corporation tax
Apple, Microsoft and Eli Lilly likely to be the top payers although companies are not identified
New research by the Irish Fiscal Advisory Council has found even more concentration in the most important tax category, with the top three paying 46pc of the total in 2024, about €13bn.The council does not identify the multinationals involved, but they are likely to be Apple, Microsoft and Eli Lilly, maker of weight loss and diabetes drugs Mounjaro and Zepbound.Previous research found that the top three paid about one-third of all corporation tax revenue between 2017 and 2021, but Ireland has now become even more reliant on the few.“Since 2023, the composition of the top three is likely to have changed,” the fiscal council said.One of the previous top three, a pharma group, has seen its profits fall sharply“Two tech companies have remained in the top three every year since 2017. However, one of the previous top three, a pharma group, has seen its profits fall sharply in recent years. As a result, it appears to have paid less corporation tax in Ireland.“It was likely replaced in 2023 by another US-owned pharma group.”The pharma group that has dropped out is likely to be Pfizer, which exported a huge amount of Covid-19 vaccines in 2021 and 2022.The amount of corporation tax paid into the Exchequer almost doubled between 2021 and 2024, driven by the top payers. The two top tech companies are estimated to have paid almost €11bn between them, nearly 40pc of the total.News in 90 Seconds, Thursday, February 19While this concentration is risky, both Apple and Microsoft are continuing to perform strongly, with each reporting double-digit global revenue growth last year and there is continuing strong demand for their products.The fiscal council points out that Ireland has become a key manufacturing base for the active ingredient used in popular weight-loss and diabetes medicines.There was massive front-loading of these drugs by US importers last year in advance of president Donald Trump’s tariffs. Higher sales would have lead to increased corporation tax payments by the manufacturer.Just under €33bn of corporation tax was collected last yearTariffs aside, there appears to have been a permanent increase in manufacturing capacity for these medicines in Ireland, which means there could be a sustained, long-term increase in exports.Just under €33bn of corporation tax was collected last year, but this could increase further in 2026 due to the higher rate of 15pc that large corporations now have to pay.“Relying heavily on just two of the world’s biggest tech companies for a substantial stream of corporation tax revenue carries significant risks,” the council warned.“At the firm or the sector level, developments such as new products not selling well, senior leadership change, pivots to new product forms and tighter regulation of the industry could result in a sharp fall in profits.“The biggest tech firms continue to invest heavily in artificial intelligence, hoping this will generate large profits in the future. However, it remains unclear whether these lofty profit expectations will be realised.”
