Apple Dodges UK Tax despite Large Revenue
Even if the company has produced pre-tax profits amounting to as high as 68 million pounds ($103.6 million) until its last fiscal year which is September 2012, not a single dime from it went to taxes. This was far from the previous year’s case where Apple reportedly paid 11.4 million pounds on tax.
Apple was able to dodge these taxes by simply awarding millions in stock awards to employees. Those awards were deductible, thereby completely getting rid of all the taxes required for its profits. Such technique is not unique to Apple. A lot of other major companies also developed ways to rescue itself from paying skyscraping taxes.
It stirred the whole of Europe when Apple allotted more than 80% of its worldwide generated operating income for an Ireland-based subsidiary. It made the company pay just 0.05% tax rate in the market. This is a lot less than the tax rates in the countries which are having the bulk of the company’s sales.
Congressional investigators documented earlier this year Apples’ capability of downsizing its tax by billions every year. All of Apple’s tax evading tactics are legal even if it cause at least $74 billion in offshore cash is being bailed out from getting taxed.
Apple CEO, Tim Cook, defended his company from criticisms, saying that Apple has done nothing wrong and they don’t “use tax gimmicks”.