Most of the articles out there today will rehash the history and traditions of St. Patrick’s Day, cover the revelry, and of course, tell you which restaurant is serving the best corned beef nearest to you. But beyond its culture, the Emerald Isle celebrates tremendous economic growth, and a large majority is in thanks to American companies.
700+ US companies now have a presence in Ireland, including big names we all know like Dell, Google, Facebook, Twitter, Johnson and Johnson, Pfizer, and many more. To put it in perspective, Ireland has gained more from American firms over the past decades than China, India, Russia, and Brazil combined. In 2014, Ireland saw a massive turnaround in its economy, growing at more than 5%, the fastest rate in Europe. Click To Tweet
But it’s not just large corporations contributing to the country’s foreign direct investment, many U.S. west coast tech companies (around 200+) are celebrating Saint Patrick’s Day in Ireland today. A special relationship has formed between Ireland and Silicon Valley, and the last year has only strengthened this growing bond with a number of investments from Silicon Valley companies.
A few include:
- Slack, who announced opening its European headquarters in Dublin
- Uber, who open its new customer service center in Limerick
- Workday, opening its new European headquarters in Dublin
- Facebook, who is constructing a new data center in Clonee
The Emerald Isle’s appeal goes beyond its seemingly perfect culture for tech entrepreneurs (who have been known to enjoy a beer or two), and its skilled tech talent to source from.
Ireland’s pull amongst US firms stems from its 12.5% corporate tax rate, amongst other tax breaks. So US firms pay about a ⅓ of what they would in the US (which is around 35% to date).
To break down the math, if your company generated $10 million in profits last year you would pay about $3.5 million in taxes, compared to $1.25 million if you were based in Ireland. That’s HUGE!
The chart from PwC below breaks down corporate tax rates across the world.
So while many in the U.S. today are thinking about green beer and giving it a go at our best Irish accent, maybe instead, it’s time ponder on the validity of the current U.S. tax code. Ireland’s economic success is not just the “luck of the Irish”, but something worth pondering more than once a year for business owners around the globe.
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