His name is Feargal O’Rourke and he’s one of the reasons why Ireland is accused of being a tax haven. Now, in an interview with Bloomberg’s Jesse Drucker, he says that Irish rules allowing the world’s multinationals to avoid home-country taxes with a “double irish” are going the way of the dodo.
O’Rourke is the son of legendary Irish politician Mary O’Rourke, cousin to the late finance minister Brian Lenihan, and confidant of numerous Irish civil servants he has advised on tax policy. He is also a partner at PriceWaterhouseCoopers, a lucrative post where he helps firms including Google, Facebook and LinkedIn use subsidiaries and pass-through entities to keep their profits far from the scrutiny of US tax collectors. The $100 billion missing from the tax coffers in the US and Europe must be made up for by other tax-payers, or with added public debt.
Perhaps his biggest victory was convincing the finance ministry, then run by his cousin Lenihan, to end a 20% withholding tax on profits leaving Ireland in 2008, which made it easier for major companies with Irish subsidiaries to send royalties to Bermuda and the Cayman islands.
O’Rourke doesn’t consider Ireland a tax haven, since many of the loopholes exploited by multinationals are found in other countries’ tax codes; the US practices of deferred taxation and blind subsidiaries are prime examples. But he does think his country is soon to end the practice of allowing foreign subsidiaries that pay no taxes in Ireland while funneling money to even more opaque tax havens—the practice that most angers US and European politicians—will come to an end soon. Coming on top of a recent promise to address the issue from current Irish finance minister Michael Noonan, it may be that the world’s most notorious tax planning scheme is indeed on its last legs.
But we’ll be watching to see what O’Rourke comes up with to replace it.