Apple to pay 318 million euros in Italy tax fraud probe

The decision to sanction Apple Italia marks a broader push by Italian authorities to shake off the country’s bad reputation for tax dodging.

To add insult to injury, Ireland will shutter the tax loophole that Apple and other American tech companies have exploited for years will have to figure out a new way to lower their tax base by the year 2020.

The US tech giant had been accused by Italy’s inland revenue of transferring profit made in Italy to a subsidiary in Ireland where corporate tax rates are more favourable.

Even though the dispute has been settled, La Republica reports that the criminal investigation will continue for three Apple executives.

Apple’s activities in the Republic of Ireland are now subject to that investigation, which is due to announce soon whether tax breaks created to secure the company’s extensive investment in Ireland amounted to illegal state aid. He had stated previously that the company “pays every tax dollar it owes”. “We pay more taxes in this country than anyone”.

For its earnings, the firm should have paid 880 Euros in Corporation tax, but the negotiated sum lets Apple off the hook for about one third of that figure.

The company routed €879 million of profit out of Apple Italia, which had been earned in Italy between 2008 and 2013, Apple Sales International, which had been listed as a “consultant” to the Italian company, thus facilitating the transaction.

Apple has reportedly reached a deal with Italy’s tax office to settle a dispute over its taxes.

Apple’s questionable arrangements in Ireland have resulted in widespread conflict about the legalities of “parking” earnings in low-tax countries to avoid higher payments.

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On an episode of 60 Minutes that aired last week, CEO Tim Cook called allegations of Apple’s tax evasion “total political crap” after being accused of holding $74 billion in revenues overseas.