Because of Ireland’s low tax regime it is advantageous for companies to try to report profits in Ireland. Through transfer pricing, which involves the Irish subsidiary overcharging other parts of the company based elsewhere for goods and services, profits can be moved from the rest of the world to Ireland.
However, this kind of internal profits shifting does very little for the domestic workforce. Indeed, in some cases headquarter companies based in Ireland may not be employing anyone at all. Wages do not increase because the Irish subsidiary is making more money. Instead profits declared in Ireland are quickly taken out of the country again. As Heike describes in her paper:
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The society is a robbing into indeed, tax scam.
