Irish tax policies are giving multinationals a “free pass” on tax and specifically damage developing countries, the UN’s special rapporteur on extreme poverty has said.

Philip Alston told an international gathering in Dublin on Thursday that low Irish corporate taxation as well as tax breaks like the so-called “double Irish” were setting a low standard for multinationals operating in poorer countries.

The New York law professor and UN expert on poverty warned a Christian Aid conference on poverty and injustice that the republic was setting a bad example around the world.

Alston said: “When developed countries tolerate internal pricing mechanisms and other arrangements that enable those corporations to effectively avoid such taxes that would otherwise be due to the developing country, they do an immense disservice.

“Ireland needs to acknowledge the spillover effect of its policies and the inconsistency between these minor components of its overall tax policy and its broader role in the world. A spillover analysis needs to be serious and transparent. Ireland’s exceptionally positive image in the world, manifest in so many contexts, should not be spoiled by tax policies that are absolutely marginal to its basic economic and fiscal strategy.”

On Irish corporation tax, he said: “The problem is not the 12.5% tax rate. Other countries have that too. The problem is that for many years now Ireland has supplemented that rate and its many natural attractions for investors with a range of schemes that look to all the world to be designed to facilitate tax avoidance by huge multinationals in return for a pittance of a reward to Ireland. But more importantly, the costs to other countries, including developing countries, have been immense.

“It might help to use an analogy. It is as if I live in a large apartment complex and the main rule is that I can do whatever I like within the confines of my own apartment. I rent it out for a small amount to a band that plays very loud music all night long. I have made a ‘rational’ decision and increased my income in a time of austerity. But the cost to my neighbours is immense and bears no real relationship to the tiny gains that I have made. Ireland’s double Irish arrangement was clearly antisocial in this respect. The Irish authorities knew exactly what was going on, long before the international community finally blew the whistle.”

In the 2015 Irish budget, the finance minister, Michael Noonan, announced he would phase out of the double Irish tax break in response to increasing international criticism of Ireland as a tax-haven for foreign corporations. In its place, Noonan unveiled a “knowledge innovation box”, which would give tax breaks to corporations and companies that developed new technological inventions and patented them in Ireland.

However, Alston also cautioned that the knowledge innovation box “could be designed in a comparable way not to reward genuine innovation but to enable tech companies and others to continue effectively laundering their profits through Ireland”.