Apple moved offshore billions to new tax havens

07 November, 2017, 02:16 | Author: Becky Perry
  • Apple moved offshore billions to new tax havens

In 2014 a US Senate committee accused Apple of seeking "the holy grail of tax avoidance" and spotlighted practices that had saved Apple from paying billions of dollars in tax over decades.

Apple shifted two of its subsidiaries from Ireland to the island of Jersey in an apparent effort to shield assets from European tax regulators, according to leaked documents from a Bermuda law firm that were reported by the New York Times.

The news outlet and the nonprofit investigative organization cited confidential records that were obtained by the German newspaper Suddeutsche Zeitung and shared.

The watchdog found the arrangements dating back to the early 1990s were illegal under state aid rules and gave Apple favourable treatment over other businesses.

In 2013, Apple had $111 billion in cash nearly entirely held by its Irish shadow companies.

APPLE shifted a load of of its offshore wealth in the face of a tax crackdown in Ireland to the Channel Islands, according to Panorama's Paradise Papers special.

"We believe every company has a responsibility to pay the taxes they owe and we're proud of the economic contributions we make to the countries and communities where we do business". The selective treatment allowed Apple to pay an effective corporate tax rate of 1 percent on European profits in 2003, according to the commission previous year. "We do not depend on tax gimmicks...we do not stash money on some Caribbean island".

Apple relocated two major subsidiaries to the Channel Island, including one holding most of its untaxed offshore cash, now worth $252bn (£191bn).

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In August a year ago, the European Commission concluded that Ireland gave Apple "illegal tax benefits" and levied the firm with an £11.6 billion in back taxes.

Jersey, an island between England and France with a population of over 100,000, was chosen because of its strong links to the British banking system and its exemption from most European Union legislation.

That advantage was at risk, however, when the Irish government announced that year that companies incorporated in Ireland would...

But Apple did not sever its Irish connection, which was established by Steve Jobs in 1980 to build Apple's first European base.

Apple and Ireland are now appealing the ruling.

The tech giant chose to shelter its money in the United Kingdom crown dependency after the Republic of Ireland tightened the rules over its tax arrangements three years ago. In private, Cook said the order was "political crap".

Apple didn't immediately comment to The Associated Press. In response to the Paradise Papers story, Apple told the Times that "we follow the laws, and if the system changes we will comply".

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