Ireland rejects U.S. senator claims as tax spat rumbles on

Fri May 31, 2013 12:37pm EDT
 
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By Padraic Halpin

DUBLIN (Reuters) - Ireland has rejected claims by two U.S. senators that Ireland is a tax haven and had handed Apple Inc a special tax deal, a charge the pair stood by on Friday.

Ireland's ambassador to the United States Michael Collins has written to the two senators, Carl Levin and John McCain, arguing Ireland's tax system is transparent, according to the text released by the finance ministry.

But Levin and former U.S. presidential candidate McCain said records obtained by their committee showed Apple paid a nominal rate far below Ireland's statutory rate of 12.5 percent.

"Testimony by key Apple executives, including CEO Tim Cook and Head of Tax Operations Phillip Bullock, corroborates that Apple had a special arrangement with the Irish government that, since 2003, resulted in an effective tax rate of 2 percent or less," the senators said in a statement.

"Most reasonable people would agree that negotiating special tax arrangements that allow companies to pay little or no income tax meets a common-sense definition of a tax haven."

Ireland has been forced to defend its low corporate tax rate after the Senate heard last week that the iPhone and iPad maker paid little or no tax on tens of billions of dollars in profits channeled through Irish subsidiaries and had effectively negotiated a special rate of less than 2 percent. {ID:nL2N0E20Y1]

NOT A HAVEN

"Ireland's tax system is set out in statute, so there is no possibility of an individual special tax rate being negotiated for companies," Collins wrote in the letter dated May 29 which was also sent to other members of Levin's Senate subcommittee.   Continued...

 
Apple Operations International, a subsidiary of Apple Inc, is seen in Hollyhill, Cork, in the south of Ireland May 21, 2013. REUTERS/Michael MacSweeney