Apple to pay Italy €318 million to settle tax fraud probe
US-based computer tech giant, Apple has agreed to pay Italy 318 million euros (USD 348 million) to settle a tax dispute after the company came under investigation for suspected fraud.
According to Italy’s tax agency on Tuesday, the company's Italian subsidiary and a number of its senior executives have been under investigation for fraud.
Fraud charges were leveled against Apple after it failed to comply with its obligations to declare its earnings in Italy between 2008 and 2013, AFP reported.
According to Italian daily, La Repubblica, Apple Italia was expected to pay a corporate tax of 880 million euros for the above period. However, after months of negotiations, the tax authorities agreed to close the case in return for the payment of 318 million euros by the company.
The spokesman of Italy’s tax office confirmed that the newspaper's report was accurate but did not accept to reveal further details of the case.
Apple Italia did not respond immediately to a request for comment on the case which is likely to set a precedent for other European countries' that deal with the company.
The dispute settlement comes against a backdrop of mounting controversy over the tax arrangements of multinational corporations that use cross-border corporate structures to reduce their tax bills.
Apple Italia is part of the tech giant’s European operation, which is headquartered in Ireland. Ireland is known as a European country with one of the lowest levels of corporate tax among member states of the European Union.
The rate of tax imposed by Ireland on corporate revenues earned through normal business activities stands at 12.5 percent, which is relatively low when compared with a standard tax rate of 27.5 percent as applied in Italy.
Earlier this month, Apple chief, Tim Cook, described accusations that the world's richest company is trying to sidestep tax payment in the US by stashing cash overseas as "political crap" while insisting that "we pay every tax dollar we owe."
However, according to La Repubblica’s report, the settlement of Apple’s tax dispute in Italy will not halt the criminal investigation into the conduct of three executives of Apple Italia, but will likely reduce the severity of any sanctions they may face.
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