The real ‘black swan’ that would dramatically affect all Irish property.
Three are two parts to this:
Ireland’s tax rate is not really the issue. France has an equally low effective rate of tax for US multinationals etc. The issue is that the Irish Revenue allow multinationals to pay 0% tax by allowing their revenues stay in the Irish system (and thus artificially inflate Irish GDP) while the cash goes the Cayman Islands etc. U.S. Multinationals are using Ireland to pay 0% tax on all European revenues. That is what France and Germany have realised and want stopped.
Dublin commercial real estate pricing is dependent of U.S. Multinationals. Over 80-85% of the true net take up of Dublin office (take out the lease rollovers Irish agents deliberately mix in) are dot.com firms, locating to pay 0% tax. They pay high rents at c. 50 per sq ft (the tax savings are 1000x the rent costs so they don’t care). At 50 per sq ft that equates to 1,000 sq ft in capital value. That is 5x the all in cost of build. Almost no cities (capital or otherwise) in EMEA outside of London, Paris and Zurich, sell for much over 3x cost of build (600-700 sq ft). That is why when Irish office weakens, it collapses.
The Euro Project is remarkably open and liberal (as the UK is discovering re immigration). The sense check, from a financial side, was that regardless of tax strategy, the net benefit would stay in Europe. Ireland, Lux and Holland however are “backdoors” for U.S. multinationals to extract revenues gross out of the EU system. There are no programmers (or many real scientists in Ireland). The jobs needed to fulfil the “backdoor” tax plans created by KPMG and PWC etc are cheaper - call centre / lower marketing and sales roles. Europe is loosing the taxation and higher quality jobs.
France and Germany know this however changing tax rules are very tricky under EU rules. The U.K.s desire to resolve some of its immigration problems could see a “grand bargain” where compromises are made to close these “backdoors”. It is one of those “slow burn” background things - but, we could wake up one day to find U.S. Multinationals gone.
Our GDP would fall by about c 20% (that is how artificial their effect on our GDP and even GNP is), and Dublin Office would fall by at minimum 50% (and more given most U.S. Multinationals have 3/5 year breaks on their leases and would dump).