First, it will hit harder than anyone realises right now. Early estimates are that it will cost the country about €2bn in lost revenues. But in reality no one really knows. What is for certain is that Ireland will be increasing taxes on around 1,500 major companies, which between them employ around 500,000 people, or slightly more than 20pc of the entire workforce.
It is very unlikely that any of them are going to pop up in the next few weeks to say, right, we’re off to somewhere with lower taxes. That is not what big, politically sensitive corporations do. Instead, we will see a steady drift away from Ireland, and a gradual reduction of their presence there.
After all, let’s keep in mind that, for all the blarney, the country is otherwise not especially appealing. It is right on the Western edge of Europe, you can only practically get there by plane (which is bad for your carbon footprint).
While the workforce is well-educated and speaks the lingua franca of global business, it is also expensive (the average salary is €49,000, and in IT it is an eye-watering €64,000). Living costs can also be punishing (the average house price is €276,000). Once the tax breaks are gone, is it really better than France, Spain or Poland for a European hub? The answer is not obvious, to put it mildly.
Next, and even worse, Ireland has thrown all that away for a gimmick. When it is finally signed over the next few days, the global tax agreement will no doubt be launched with much fanfare. We will hear a lot of grand-standing about how corporations will be made to pay their fair share, how avoidance will be stamped out, and how governments will have a lot more money to pay for social programmes.