Apple has moved into 10 years 128 billion Dollars in the shelter of Jersey

JESSE DRUCKER, SIMON BOWERS / THE NEW YORK TIMES

The US company earns almost 70% of its worldwide profits from its offshore business.

Four years ago, exasperated Tim Cook, the Apple CEO, told US Senate members that his company never avoided paying taxes or transferring profits to exotic Caribbean islands. Indeed, Tim Cook did not lie, since these profits had been transferred to the Channel Islands, as evidenced by Paradise Papers.

But what happened in May 2013? A subcommittee of the US Senate has been doing a long-term investigation, concluding that Apple had managed to avoid paying US $10 billion in taxes to American financial services, transferring its profits to its Irish subsidiaries. The subcommittee called them “ghost companies”. Clearly unhappy, Tim Cook made a statement in his testimony to members of the subcommittee that “Apple pays up to the last cents and does not resort to tricks.”

Five months later, the Irish authorities abolished the arrangements that allowed Apple to transfer profits to its subsidiaries in the country. According to Paradise Papers, then Apple, with the help of law firms specializing in offshore havens, sought alternatives and after several choices it came to the island of Jersey. There, corporate profits are virtually non-taxable. Over the past ten years, the US group has earned $128 billion in profits from offshore accounts. Most likely, they are much higher than those that are taxed in the US or any other country.

According to research by the International Association of Research Journalists, published by the Paradise Papers, multinational groups take full advantage of any discrepancy between national tax systems. For example, they transfer their trademarks and patent rights to other countries, avoiding high taxation.

“The American multinational groups are a masterpiece in tax evasion, which deprives valuable revenues from US state funds and other major economies,”

said Southern California University Law Professor Edward Kleinbard. Mr. Kleinbard had previously worked as a tax consultant for large companies. Today in the US there is a debate on reducing the corporate income tax rate to 20% from 35%. However, as evidenced by Paradise Papers, American giants are inventing creative ways to pay far less than 35%. Apple gains almost 70% of its international profits from offshore operations. Its spokesman, however, stated that:

“the company follows the laws of each country and, if they change, is adapted.”

In May 2013, the competent Senate Subcommittee of Investigation found that each year Apple transferred billions of dollars to three of its Irish subsidiaries that were not subject to any tax system anywhere in the world. Irish law allows companies to avoid taxing their income if they manage and persuade financial services to be “run and controlled” by the board abroad. Apple, therefore, seemed to “run and control” its Irish subsidiaries from its headquarters in California. At the same time, under United States law, US multinational subsidiaries were taxed in the United States only if they were registered there. Finally, it is possible to postpone indefinitely the taxation of out-of-border profits of multinationals for as long as they remain on foreign territory.

 

Source: http://www.kathimerini.gr/

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