Apple isn’t the only big name company taking advantage of offshore tax loopholes, according to a new study. American Express, Dell, Microsoft, Nike, and other Fortune five hundred companies bear evidence of tax haven profits in their financial reports.
The Citizens for Tax Justice (CTJ), a central-leftist think tank
in Washington DC, released a report on Monday which censures 18
other companies also suspected of holding profits in tax havens,
declaring, in the reports title, ‘Apple is not alone.’
In their latest annual report, Apple disclosed they would pay at
least a 30 percent US tax rate on the offshore income if
repatriated. An indication that there is still profit being
stashed away in tax havens, such as Bermuda and the Cayman
Islands, the report suggests.
The CTJ report outlines 18 corporations’ disclosures which fix an
amount to un-repatriated income, in millions, which indicated
they have paid very little tax on their profits to any government
yet.
According to the report, 55 US companies minimized their tax
payments by $127.5 billion by funneling profits through offshore
jurisdictions, and would collectively owe the US government this
sum if a tax repatriation proceeded.
235 of the Fortune 500 companies are ‘non-disclosing’, which the
center calculates holds $720 billion in un-repatriated offshore
income. Google, General Electric, Coca-Cola, Wal-Mart, and Cisco
Systems are among the ‘non-disclosing’ bloc.
Under the current law, corporations can indefinitely defer paying
US income taxes on their offshore profits.
Avoiding or minimizing the payment of taxes, as opposed to
evasion is not a criminal offense. However, the authorities have
defined tax evasion as immoral and contrary to the spirit of
entrepreneurship and law in the US.
Mr. Cook, Apple CEO, sat before the permanent Senate
subcommittee on May 21st , as they questioned him on why his
company had avoided paying tax on $74 billion of profit between
2009 and 2011.
Cook has repeatedly denied Apple uses ‘tax gimmicks’ or has an
elaborate offshore profit scheme. Before the hearing, Apple
released Cook’s prepared speech which certified Apple was the
country’s biggest corporate taxpayer in 2012, and paid nearly $6
billion in taxes.
A two-pronged tax avoidance strategy, Carl Levin (D-MI) the
chairman of the committee, coined it, accusing Cook’s company of
single-handedly rewriting rules of intellectual property as well
as knowingly shielding offshore income from US taxes.
Apple has $102 billion in offshore accounts, shifting profits
away from US subsidiaries to Ireland, where it paid a tax rate of
less than 2 percent, according to the senate panel report.
Senators John McCain (R-AZ) and Levin suggested the Irish
government played an assisting role in helping Apple trim its
taxes in a ‘highly questionable’ offshore entity sum which never
trickled back to US income taxes.
Ireland has vehemently denied it is a tax haven and on Wednesday
called for an international clampdown on multinationals, yet sits
at the center of the controversy. Apple Inc. paid just 2 percent
on $74 billion in overseas income, which was mostly facilitated
by a loophole in Ireland’s tax code.
The ‘Irish double dip’ allows a company to file two subsidiaries
in Ireland with a corporate tax rate of 12.5 percent, which is
far less than the 35 percent rate in the US, for example.
The theme of Apple, and many other companies use of ‘legitimate
tax abuse’ will be discussed by the OECD at the G20 summit in
July.
This article originally appeared on: RT