Far-reaching global tax reforms are reaching fruition and on the face of it, Ireland has most to lose because of the economy's strong reliance on US multinationals.
On Thursday, 130 countries endorsed an outline agreement by the Organisation for Economic Co-operation and Development (OECD), which groups 38 wealthy nations, to level up global corporation tax.
"Pillar one" would re-allocate tax jurisdiction from where multinationals are headquartered to where they make profits, while the second pillar would establish a global minimum rate of 15%.
The OECD says the deal will generate an estimated US$150 billion in extra revenues globally, adapt the tax system to the modern digitalised economy and support state finances battered by the coronavirus crisis.
The pact came after the G7 group of wealthy democracies - Canada, France, Germany, Italy, Japan, the US, and UK - last month agreed on the minimum rate of 15% for corporation tax.
Ireland has maintained a 12.5% rate since 2003, and has become the European base for a raft of US companies, especially technology and pharmaceutical firms whose profits have swelled during the pandemic.
Ireland was one of only nine nations that refused to sign up despite expressing "broad support", owing to the 15% proposal.
Minister for Finance Pascal Donohoe said: "I have expressed Ireland's reservation, but remain committed to the process and aim to find an outcome that Ireland can yet support."
Some analysts believe Ireland's economy is over-dependent on multinationals like Facebook, Apple, and Google.
Just ten firms paid 51% of Ireland's corporate tax receipts last year.
In 2019, Ireland drew 15.7% of its total fiscal intake from corporation tax.
The Department of Finance expects to lose €2bn each year from 2025 if the global minimum rate comes about.
Research company Oxford Economics predicted the OECD reforms would make Ireland one of Europe's most indebted states, and it also faces disruption from the UK's departure from the European Union.
Economics professor Lucie Gadenne of University of Warwick in England has said that with tax havens such as the Cayman Islands also signing up to the proposals, Ireland knows "the writing is on the wall".
The OECD deal's exemption for financial services, which favours the UK, suggests Ireland could carve out its own concessions.
Ms Gadenne told the AFP news agency: "Individual countries can use whatever bargaining power they have to gain exemptions for national champions.
"Ireland are trying to maximise their negotiating power by holding out and putting pressure on the EU-level negotiations.
"Ireland's tax haven model has served it well, but it may need to graduate to a more sustainable economic model."
Former Central Bank commissioner and economic Professor John FitzGerald thinks any Irish fears are overblown.
He told AFP: "I can see no reason not to adopt it if the US implements it," noting US President Joe Biden still has to persuade recalcitrant Republicans in the US Congress.
Mr Biden said the minimum rate would "halt the race to the bottom for corporate taxes" and prevent multinationals from pitting countries against each other.
Mr FitzGerald commented: "No firm could do better by leaving Ireland, so if 15% is everywhere you might as well be in Ireland and pay.
"If the US implements the rules, Ireland could end up with more revenue."
Corporation tax is just one factor explaining Ireland's stellar growth of recent decades and attractiveness to foreign investors, alongside a highly educated, English-speaking population and strong infrastructure.
Mr Fitzgerald concluded: "The jobs would remain here because there are the skills, the capital investment, physical capital, they cannot move easily. I do not see any long-term implication for the Irish model of economic development."
Further negotiations including a meeting of G20 finance ministers in Italy this month and political bargaining in the US Congress and the EU mean there is still a long road ahead.
Within the EU, Hungary is another holdout, although Germany and France are four-square behind the OECD agreement.
Emer Mulligan, of the J.E. Cairnes School of Business and Economics at the National University of Ireland said: "It is only when you know the technical details that you can assess the impact."
She emphasised the "real meat" lay in pillar one - taxing companies more where they operate, rather than where they register their income.
