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Apple Inc. To Pay Italy $348 Million Over Tax Dispute
The maker of iPhones and iPads will also sign an accord next year on how to manage its tax liabilities from 2015 onward, the source said.
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Apple Italia and several of its senior executives had been under investigation for fraud over the alleged failure to comply with obligations to declare its earnings in Italy between 2008 and 2013.
Apple Inc. will pay the tax office of Italy 318 million euros ($348 million), following the tax fraud allegations investigation.
The EU’s 28 states agreed in October to share details of tax deals they reach with big companies to make sure they are fair to other nations.
According to the Italian daily newspaper La Repubblica, Apple Italia should have paid corporation tax of €880m for the period. Apple Italia did not respond immediately.
The move by Italian authorities comes as officials look to strengthen tax revenue from both local and multinational companies to offset the country’s lagging economy.
He said that while the sum was just a “nuisance” for Apple, the case did create a reputational problem: “It’s not a very positive public relations thing to be branded a serial tax avoider”. Ireland was held by the European Union previous year for bending the worldwide tax rules as it allows Apple to shelter tens of billions of its profits in return for job security. Other companies who are now target for tax inquiries in Europe are Google and Amazon.
However, after months of negotiations between the two sides, the tax authorities agreed to close the case in eturn for 318 million.
Apple is also facing criticism on its home turf in the United States because of the so-called inversion deals, whereby a company redomiciles its tax base to another country.
In a recent interview with the CBS television news show “60 Minutes”, Apple Chief Executive Tim Cook dismissed as “total political crap” the notion that the tech giant was avoiding taxes. The Irish government is likely to appeal any decision that would force the country to recover any owed taxes from Apple in order to protect a low tax regime that has enticed many global companies to set up operations in the country.
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Apple designs and markets consumer electronics, computer software, and personal computers.