Ireland is a European country whose GDP has been inflated by global tax-shifting. Big multinational firms book profits from globe-spanning operations through Irish subsidiaries. Tech giants like Apple and Microsoft transfer intellectual-property rights to Irish subsidiaries, which collect royalties from higher-tax jurisdictions. Pharma groups use a similar trick, also manufacturing blockbuster drugs in Ireland. The country's corporate-tax rate is 12.5%, one of the world's lowest.
Corporate tax from foreign firms brings in €20bn a year and rising—enough to cover the cost of schools and hospitals, according to the Irish Fiscal Advisory Council. Foreign firms account for 11% of the workforce and a third of income tax. Just three companies accounted for 38% of all corporate-tax receipts in 2023, leaving Ireland dangerously exposed. The distortion of GDP is so severe that Irish officials use their own measures for growth. In the first quarter of 2025 Ireland's GDP rose 9.7%, contributing over half of the entire EU's growth—from a country of around one-hundredth of the EU's population.
The Irish Fiscal Advisory Council has warned of Ireland falling prey to "Dutch disease", the imbalance that struck the Netherlands in the 1970s as natural-gas money sent the rest of its economy off-kilter. Only about a tenth of the €160bn earned in the past decade from corporation tax has been saved. The presence of highly paid tech workers has exacerbated a housing shortage in Dublin.
America's goods deficit with Ireland is the largest after those with China, Mexico and Vietnam, all rather larger economies. The deficit is largely illusory—a side-effect of drugs developed in America being sold to Americans via Ireland—but Donald Trump equates goods imports with the theft of American jobs. At a St Patrick's Day visit to the White House in March 2025, Trump told Taoiseach Micheál Martin that America had been "stupid" in its dealings with Ireland. Attempts to end Irish tax-shifting during Trump's first term helped turbocharge the arrangements instead.
Had Ireland not been an EU member, Trump's "reciprocal tariff" formula would have produced tariffs of 15% rather than the 20% applied to the whole bloc. Some in the EU argue that America should address its goods-trade deficit with Europe by tackling Irish tax arrangements rather than imposing tariffs on all EU firms.
Ireland's neutrality is rooted in its blood-soaked history, including a civil war after British colonial rule ended in 1922. The country's "triple lock" law, crafted in 1960, requires overseas troop deployments to be approved by the government, the lower house of parliament and the UN Security Council. The formula was originally designed to allow war-wary Ireland to send peacekeepers abroad, and was later amended to ensure that, should the EU ever form an army, Ireland could not be forced to provide troops. Ireland has cast itself as a benign power that sends peacekeepers to help other decolonised nations. Even after planned increases, Ireland will devote less than 1% of GDP to defence.
The northern hemisphere's most important sub-sea cables run through waters under Irish control, yet its navy has since 2023 maintained just two operational patrol ships at any time. Its air force has no fighter jets.
The Irish language is making a steady comeback. Some 1.8m people (around 40% of the population) claim some ability to speak it, up 71% from 1991. Irish became a fully fledged official and working language in the European Union in 2022. Catherine Connolly, president since November 2025, has pledged to make it the working language of the presidential office. See Irish language.
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