Ireland closes tax loophole used by corporates such as Apple

IRELAND PLANS to close a tax loophole used by many large businesses, such as Apple.

Previously companies that had Irish subsidiaries could declare that they had no tax residency anywhere in the world, the BBC reports.

The Irish government said it is now planning to make it illegal for companies to declare that they have no tax domicile.

Ireland’s finance minister Michael Noonan said his country was committed to reform.

“Let me be crystal clear. Ireland wants to be part of the solution to this global tax challenge, not part of the problem,” he said.

However, companies can nominate any country in the world as their tax residence, including Bermuda which has a zero tax rate.

Because of that clause it is unlikely large corporations such as Apple will see any difference to the amount of tax they must pay. For instance, both Google and Microsoft both have Irish subsidiaries and have nominated Bermuda as their tax domicile.

Earlier this year the US Senate Committee said Apple had used complex “offshore entities” to avoid the payment of billions of dollars in taxes.

All three companies said that they abide by the tax laws in every country in which they operate.