Italy investigates Apple for alleged tax fraud: sources
By Manuela D'Alessandro
MILAN (Reuters) - U.S. tech giant Apple is under investigation in Italy for allegedly hiding 1 billion euros ($1.34 billion) from the local tax authority, two judicial sources with direct knowledge of the matter told Reuters.
Milan prosecutors say Apple failed to declare to Italian tax authorities 206 million euros in 2010 and 853 million euros in 2011, one of the sources said, confirming a report by Italian magazine L'Espresso.
"Checks on the size of the tax are under way," the source said.
The Italian subsidiary of Apple booked some of its profit through Irish-based subsidiary Apple Sales International (ASI), thus lowering its taxable income in Italy, the source said.
"Apple pays every dollar and euro it owes in taxes and we are continuously audited by governments around the world," the company said in a statement. "The Italian tax authorities already audited Apple Italy in 2007, 2008 and 2009 and confirmed that we were in full compliance with the OECD documentation and transparency requirements. We are confident the current review will reach the same conclusion."
The maker of the iPhone is the latest prominent corporation to become the target of a tax inquiry in Italy amid a global crackdown aimed at preventing companies such as Google, Amazon and others from avoiding taxes.
In crisis-hit Italy, tax authorities faced with dwindling revenues have become more aggressive with domestic and multinational companies.
In June, fashion designers Domenico Dolce and Stefano Gabbana were handed a 20-month suspended prison sentence and a heavy fine for hiding hundreds of millions of euros in unpaid taxes. Both deny any wrongdoing. Continued...