Veiled friction between Dublin and Brussels which could shake foundations of the 'Celtic Tiger'

The Republic has often been portrayed as the model EU country, in the years since the Brexit referendum. In contrast with truculent, uncooperative Britain, with its long history of euroscepticism and its decision to leave, Dublin was keen to prove its loyalty to Brussels.

Things were never as simple as that and there are issues between the Republic and the EU that cut to the heart of its economic success.

For many years, the south courted multinational tech companies, attracting investment from the likes of Facebook (now Meta), Google and Apple. These Silicon Valley giants, in turn, filled Dublin’s tax coffers and funnelled money through the Republic, improving its GDP figures.

These cosy arrangements have caused unhappiness among EU officials.

Brussels is reportedly trying to strongarm the Irish authorities into extending an investigation into Meta’s approach to European data protection laws. The Republic’s data protection body now plans to take the EU to court, accusing it of ‘overreach’.

This is not the first time that Brussels and Dublin have clashed over matters related to the south’s economic model. The European Commission sued Apple over its tax affairs, alleging that the Republic provided it with illegal ‘state aid’ by reaching a ‘bespoke’ deal with the company. That case returns to the courts this year.

The EU applied enormous pressure over the Irish corporation tax rate of 12.5 per cent, which was a longstanding cause of friction. The outcome was a new deal that will push the minimum up to 15 per cent for multinationals in the Republic.

These disagreements are generated because Dublin’s low tax, low regulation model clashes with the EU’s overbearing, bureaucratic instincts.

For all the pro-European rhetoric down south, if Brussels gets its way, the foundations of the ‘Celtic Tiger’ could soon be shaking.