DUBLIN: Ireland’s economy grew by a “very dramatic” 26pc last year, boosted by one-off corporate tax inversions and aircraft purchases, according to official statistics.
The Irish Central Statistics Office (CSO) had previously estimated that gross domestic product (GDP) rose by 7.8pc in 2015, but revised up the figures after receiving “more complete and up-to-date data” for the end of the year.
An increase in aircraft imports for international leasing and the reclassifications of corporate balance sheets through tax inversions into Ireland were among the reasons for the GDP figures more than tripling to the fastest pace of growth on record.
Michael Connolly, a CSO statistician, said: “What happens here is that an entire balance sheet of a company relocating to Ireland, from somewhere else, is included in our capital stocks or our international investment position.
“The very dramatic increase has increased the capacity for production in the economy and impacts the accounts for 2015 in the increase of exports and imports.”
The GDP figures total all economic activity within Ireland’s borders, whether conducted by nationals or foreign investors. Accordingly, the relocation of foreign corporate headquarters to Ireland, such as those of Perrigo and Jazz Pharmaceuticals, has artificially inflated the GDP numbers.
Mr Connolly added: “We are a very small economy, and if we get a big increase in assets, this is what happens.”
Ireland boasts an internationally low 12.5pc corporation tax levy and a welcoming tax regime, which has encouraged many US companies to redomicile, shifting their businesses to the European economy.
