Nicholas Shaxson, the author of Treasure Islands: Tax Havens and the Men Who Stole the World discussed the notion of competing through corporate tax policies on the Moncrieff Show today, arguing that countries can't really use tax incentives to attract businesses.
He says that Ireland's low 12.5 percent corporate tax rate has not been responsible for economic growth in Ireland.
Mr Shaxson argues that Ireland's success in the 'Tiger years' was due to a number of social and geographical factors that made the country a perfect English-speaking launching-pad for multinational companies trading in the euro zone since the signing of the Maastricht Treaty in 1992.
He adds that historical and cultural links with the United States also encourage US companies to come here, calling our tax incentives the "cherry on the top" of our overall package.
These tax incentives might create some extra jobs, but there are trade-offs:
"These [tax] offerings come at a cost to countries, in terms of inequalities. You get an awful amount of money coming to a very small group of people," Mr Shaxson told Seán Moncrieff.
He continues, "There is an increased political influence from the financial sector - and the tax sector. It damages democracy."
After the recent leaks of documents that seem to outline industrial-scale tax avoidance in Luxembourg and Switzerland, Mr Shaxson says that he would not be surprised if similar documents came to light in Ireland.
Ireland is currently being investigated by the European Commission regarding Apple's tax payments here, and a ruling is expected in the second quarter of this year.
