Three companies pay a third of corporation tax receipts, McGrath says

By Cate McCurry, PA

About a third of the State’s corporation tax receipts is collected from three individual companies, the Minister for Finance has said.

Michael McGrath warned of a “concentration risk” as the top 10 businesses in the Republic contribute almost 60 per cent of all corporation tax.

It came as a report claimed it is “probable” that two or more companies may be contributing at least 10 per cent or more of the country’s corporation tax revenue each year.

The report from the Parliamentary Budget Office looked at the growth of Ireland’s business tax groups.

It also said there is a limited amount of information available about the country’s biggest corporate taxpayers.

Mr McGrath said: “I don’t get down to the level of individual firms or a couple of firms in the analysis that I or my department do, but we are aware from publicly available information, including the assessment by the Fiscal Advisory Council, that, over a period of about four years, about a third of the corporation tax receipts that Ireland has been collecting can be identified as coming from three individual companies.

“Whether it be the top three or the top two or the top 10, the overall message is clear – there is a concentration risk.

“We are dependent on a relatively small number of very large companies who are paying a large proportion of the corporation tax.”

Mr McGrath said the report highlights the “risks” involved around a small number of companies paying a large portion of corporation tax.

“The high level of corporation tax receipts that we are collecting is a reflection of the strength of the foreign direct investment sector in Ireland,” he told RTÉ's Morning Ireland.

“It is a sector employing over 300,000 people, particularly in life sciences, including pharma, technology, financial services, and a whole range of other sectors.

“But what the report does very usefully highlight are a number of risks that I have been talking about for quite some time.

“One of them is the concentration risk. We have known from Revenue publications, for example, that the top 10 companies contribute almost 60 per cent of all the corporation tax paid.

“In the next number of weeks, the Revenue will provide a further update in relation to the evolving concentration risk.”