According to a Brisbane Times report, European governments are targeting companies that shelter funds in subsidiaries in countries (or US states in the case of Nevada) with low corporate tax rates.
“BusinessDay can reveal that the Australian Tax Office has hit Apple with a $28.5 million bill for back taxes, and in Europe global technology companies are under intense pressure to justify their complex ownership structures that rely heavily on tax havens,” the report said.
“In Apple’s case, the Australian company is owned by Apple Operations International, a subsidiary in Cork, Ireland, which is in turned owned by Apple companies in Britain, the US and tax haven the British Virgin Islands.”
Apple saw a revenue of $4.87 billion in Australia in 2011, with a tax bill of $94,7 million over the fiscal year.
Apple is not the only company to come under scrutiny however, Amazon was handed a $252 million tax bill from the French government this week over tax havens in Luxembourg.
In April, a New York Times report alleged that Apple uses a small office in Reno, Nevada, just over 300km from its headquarters in Cupertino, California, to “collect and invest the company’s profits” and sidestep “state income taxes on some of those gains”.
Nevada does not have a corporate tax, but California’s corporate tax rate is 8.84 percent.
In a statement to the New York Times, Apple said it “pays an enormous amount of taxes, which help our local, state and federal governments. In the first half of fiscal year 2012, our US operations have generated almost $5 billion in federal and state income taxes, including income taxes withheld on employee stock gains, making us among the top payers of US income tax.”
The company added that it “has conducted all of its business with the highest of ethical standards, complying with applicable laws and accounting rules”.