A US Senate committee accused Apple Inc of running a complex web of offshore business interests to avoid paying billions of dollars in income taxes, saying the technology giant was "among America's largest tax avoiders."
The committee is to hold a hearing Tuesday to highlight Apple's tax avoidance strategies. Company chief Tim Cook was expected to testify.
In addition to moving assets to tax havens, Apple also was accused of using loopholes in the United States to avoid taxes on 44 billion dollars in taxable offshore income over the past four years.
Apple said in a statement before the testimony that it did not use "tax gimmicks" to avoid paying taxes.
The Senate Permanent Subcommittee on Investigations said Apple's tax avoidance strategies were similar to those used by Microsoft and Hewlett-Packard, whose "dubious strategies" were scrutinized in 2012.
"Apple wasn't satisfied with shifting its profits to a low-tax offshore tax haven," said committee Chairman Carl Levin. "Apple sought the Holy Grail of tax avoidance. It has created offshore entities holding tens of billions of dollars while claiming to be tax resident nowhere."
Committee member John McCain said, "Apple claims to be the largest US corporate taxpayer, but by sheer size and scale, it is also among America's largest tax avoiders."
"A company that found remarkable success by harnessing American ingenuity and the opportunities afforded by the US economy should not be shifting its profits overseas to avoid the payment of US tax, purposefully depriving the American people of revenue," he said.
The findings, which came amid a global push to curb tax evasion, were likely to renew a debate about whether the US tax system needs overhauling.
Apple said its corporate income tax rate was 30.5 per cent, which is close to the US statutory maximum rate of 35 per cent.
Two of the offshore subsidiaries used by Apple are based in Ireland and are not tax residents anywhere, the Senate committee said.
Irish Foreign Minister Eamon Gilmore said his country's taxation system was not the problem and issues arising from the taxation systems in other jurisdictions needed to be adressed first.
Gilmore spoke Tuesday in Brussels, where he was chairing a meeting of EU European affairs ministers.
"Of course, we'll look at the [US] report," he said. "But let's be very clear about this - Ireland has a very strong, very transparent tax regime."
An EU spokesman also rejected suggestions that Ireland, a member of the bloc, is a tax haven comparable with Bermuda and the Cayman Islands.
"I don't think we would go that far, no," European Commission spokesman Michael Jennings said.
He declined to comment specifically on the Apple case but said corporate tax avoidance is "an abuse that we need to stop urgently."
"What we want is measures to make it more difficult for businesses to use artificial arrangements to avoid tax," Jennings said.
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