Apple's solution to tax crackdown; find a new loophole

Apple's solution to tax crackdown; find a new loophole

Apple said that after its reorganisation it is paying more Irish tax than before.

Apple would thus appear to have switched tax shelter strategies from the Caribbean "Double-Irish-Flip" to a "Jersey Isle".

Apple is said to have settled on Jersey, a self-governed territory that offers an enticing zero per cent corporate tax rate for foreign companies.

It said it remained the world's largest taxpayer, paying about $35bn (NZ$49bn) in corporation tax over the past three years, that it had followed the law and its changes "did not reduce our tax payments in any country".

The documents, obtained by German newspaper Süddeutsche Zeitung, were reviewed by the International Consortium of Investigative Journalists (ICIJ), along with a number of publications, including the New York Times and the Guardian.

The moves came after a US Senate subcommittee found in 2013 that Apple had avoided tens of billions of dollars in taxes by using overseas havens.

Until 2013 Apple had funneled earnings from outside of the Americas through Ireland, which enabled the company to pay as little as 2% in corporation tax.

The incentive, known as a capital allowance, offered Irish companies big tax deductions over many years if they spent money buying expensive intangible property.

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The iPhone maker hit back after a series of reports on Monday questioned Apple's tax affairs, which were revealed as part of the Paradise Papers.

Paradise Papers documents show Apple's two key Irish subsidiaries, Apple Operations International (AOI), believed to hold most of Apple's $252bn overseas cash hoard, and Apple Sales International (ASI), were managed in Jersey from the start of 2015 until early 2016.

It said reports inaccurately state that it is avoiding tax in the US.

The Paradise Papers disclosures come as President Trump's administration seeks to overhaul the US federal tax code. The company didn't immediately respond to requests for further comment on its worldwide tax arrangements.

- Britain's Queen Elizabeth II has, through the Duchy of Lancaster which provides her income and handles her investments, placed around £10 million ($13 million, €11.3 million) of her private money in funds held in the Cayman Islands and Bermuda. "The changes we made did not reduce our tax payments in any country".

In August past year, the European Commission concluded that Ireland gave Apple "illegal tax benefits" and levied the firm with an £11.6 billion in back taxes. We do not depend on tax gimmicks.

The European Union is now trying to force Ireland to collect €13 billion ($15 billion) in unpaid taxes from Apple.

In a statement on Apple's website, the company said it has paid $35 billion (£26 billion) in corporate income taxes over the last three years. In 2014, Apple paid a tax rate of 0.005 percent.

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