Apple agrees to pay £235m in Italian tax case

Italy has already brought several cases against global technology companies that have headquarters in low-tax nations like Ireland to avoid paying higher taxes in other countries, like Italy.

Tax officials won’t say what Apple has agreed to pay, but citing local reports, the Times reports it may be around $350 million.

The deal follows an investigation by Italian tax authorities into whether Apple funneled more than $1 billion in revenue from Italy through an Irish subsidiary to lower its tax bill. Representatives for Apple werent immediately available to comment when contacted by phone and e-mail. “Apple pays every tax dollar we owe”. Given that therefore Apple banks $16,900 a second in net income, today’s check to the Italians will set the company back just under six hours of global annual profit.

The reports came in the wake of other questions and allegations of suspected tax underpayments by Apple and other USA multinational firms.

The probe revealed that Apple had been booking its sales in Italy through Ireland, where its European HQ is based.

Ireland taxes corporate earnings from normal business activities at a rate of 12.5%, which compares with a standard rate of 27.5% in Italy.

Tax evasion court rulings that end with jail terms are rare in Italy.

Apple’s gaffer Tim Cook is not impressed with all these accusations.

Legal experts have pointed out that the relatively low tax payment is based on the fact that investigators have charged Apple not with “fiscal fraud” but rather with an “incomplete [tax] declaration”. But, after months of negotiations, the tax authorities agreed to close the case in return for around a third of that amount.

Many US multinationals, with Apple at the fore, take advantage of loopholes in the US tax code to defer taxes on overseas profits and accumulate large amounts of ostensibly “overseas” un-taxed cash. Amazon.com, McDonald’s and Starbucks have all had inquiries from the European Union about the practice.