Double Irish tax scheme has been under fire from non-Irish countries, like the United States, that do not wish to lower their corporate tax rates and insist that Ireland raise its rate so corporations stop flocking to Ireland to save some money.
The grumbling has verged on extortion in America, where AbbVie has just decided to drop its acquisition of Shire Pharmaceuticals because new laws meant to punish Double Irish consumers would have made the deal less profitable. All to the good of Shire, which stands to gain a break-up fee of something around one billion dollars, which it will then use to buy another company so it can grow while AbbVie can go explain to its stockholders why things just didn't work out in the pending marriage.
Enticing foreign corporations to locate on Ireland's shores brought in so much money that the Celtic Tiger was born. There was no need to produce anything, and on an island without a lot of natural resources, that means a great deal. It was the tax inversion that brought prosperity to a poor country for the first time in its existence. Under pressure, Ireland has had to scrap the scheme.
At the same time, governmental types are well aware of the benefits of tax inversions, and just because they have caved in to the pressure on the Double Irish, they aren't going to not offer special deals and various bargains for foreign corporations willing to set up a small office in Dublin. And hire a couple of Irish nationals to shuffle the paperwork.
So the State will see your Double Irish rate of 12.5 percent and double down.
Have a patent, perhaps? Register it in Dublin and it's Irish intellectual property. Your tax rate? 6.25 percent.
It will be called "The Knowledge Box", as in computer technology knowledge that might be used by Amazon, Apple, Google, or Ebay. It's new drugs that might be developed by any of the big pharma companies that already have a presence in Ireland, and might therefore be enticed to stay.
Government is working with the very executives of these multinational firms affected by the death of the Double Irish, and together they will develop a policy that will save those multinationals some money. You don't see anyone in Government consulting with foreign heads of state on the new scheme, do you? It's being done to keep the tax inversion money flowing in, and what those foreign heads of state competing for the same pile of cash want is the opposite of what would be best for Ireland.
If the EU doesn't go for it, then there are other schemes in the works that can be modelled on similar tactics currently in force in other EU nations that were hoping to siphon off Ireland's tax exiles who would leave when the deal wasn't so good, and go looking for a more welcoming tax levy.
The Double Irish might be gone but the notion of attracting foreign investment via tax savings is still very much alive and well.
All that chatter out of Washington DC will not kill off what brought new life to a poor country. There is always a way around whatever barriers are erected, especially when money is involved and the Irish taxpayer is stretched to the limit and can't be asked for more.