Ireland’s Finance Minister Michael Noonan has announced the crisis-racked country’s first austerity-free budget in seven years, and the phasing out a loophole that let multinationals slash their tax bills by billions.
Under the so-called ‘Double Irish’ arrangement firms like Google and Apple could channel revenues to an Irish subsidiary, which passed it on to another company with a liability only in a tax haven such as Bermuda.
Noonan said: “I am abolishing the ability of companies to use the ‘Double Irish’ by changing our residency rules to require all companies registered in Ireland to also be tax resident in Ireland.”
That brings Irish law in line with US and British rules, but companies already using the loophole will have until the end of 2020 to stop.
It is calculated 1,000 foreign firms have moved to Ireland to benefit from its tax code – creating around 160,000 jobs.
The budget also gave a tax break to Irish citizens to offset part of new water charges, introduced as a condition for the EU/IMF bailout programme that ended last year.
That move has caused anger with big demonstrations against what many saw as further austerity.