US Senate to quiz Apple on profits as Irish tax rules back under spotlight
20 May 2013
Posted by: Author: Donal O'Donovan
Source: Donal O'Donovan (Irishindependent.ie)
IRELAND'S tax rules for multinational corporations will be back in focus tomorrow when a powerful US Senate committee questions the head of technology giant Apple on its offshore assets.
The deepening economic crisis is leading big countries such as the US and UK to question the relatively low amounts they take in from taxing large, profitable corporations.
Apple has previously been criticised for using a tax avoidance structure dubbed the "double Irish" that involves using companies based here to reduce its overall tax bill. Such structures are legal and Apple has a significant presence here as a major employer in Cork.
In Washington, Apple chief executive Tim Cook will be questioned by members of theSenate Permanent Subcommittee on Investigations.
The committee is headed by the tough-talking Democratic senatorCarl Levin, who last year led a probe into money laundering by banking giant HSBC that resulted in a record $1.9bn (€1.5bn) fine for the bank.
The US focus on off-shore tax avoidance comes as UK parliamentarians pile pressure on Google over its use of Ireland to legally reduce the amount the internet giant pays in taxes there.
The controversy over the use of legal offshore tax havens now looks set to top the agenda when leaders from the G8 group of the world's biggest economies meet in Co Fermanagh in June.
British Prime Minister David Cameron, who is hosting the G8, plans to use the event to get other leaders to agree ways of preventing multinationals from exploiting tax loopholes.
The event in Fermanagh promises to be a major tourism showcase for Ireland but the focus on tax means the Irish Government is under pressure to make sure it is not marred by accusations that the low corporation tax rate here means the country operates as an offshore tax haven.
Security efforts are already under way around the Lough Erne resort where the meeting will be held.
The Border region is set to benefit financially from the G8 meeting, according to a new study by the University of Ulster.
Local businesses in the north- west, including the hospitality sector, will generate an estimated €2.5m in new business in just the two days of June 17 and 18 that the meeting takes place.
The direct benefits to Northern Ireland from the G8 meeting are estimated to be in the region of €50m.