Apple Inc. (NASDAQ:AAPL) has defended its tax payment arrangements in the U.S., before the release of a Congressional report on the tax arrangements of the iPhone maker.
Apple said in a statement that it paid a huge amount of taxes to local and federal authorities.
“In fiscal 2012 we paid $6bn in federal corporate incomes taxes, which is one out of every $40 in corporate income taxes collected by the US government,” the company said.
Apple’s statement about its tax arrangement came after the Senate Permanent Subcommittee’s investigation of at least six of the leading technology companies in the US, including Hewlett-Packard Company (NYSE:HPQ), Microsoft Corporation (NASDAQ:MSFT), and Google Inc (NASDAQ:GOOG).
According to the corporate filing, accountants at Apple Inc. (NASDAQ:AAPL) legally allocated approx. 70 percent of the company’s earnings in foreign countries in order to avoid higher tax rates, notwithstanding that most of Apple’s executives, employees, product designers, marketers, and retail stores are based in the United States.
During the US inquiry, it was found out that Apple Inc. (NASDAQ:AAPL) had deferred taxes on at least $35bn of its offshore income during just two years.
In another statement, the company argues that it was “”one of the top corporate income taxpayers in the country, if not the largest”. Defending its tax practices, the company claimed that it ”conducted all of its business with the highest of ethical standards, complying with applicable laws and accounting rules”.
On the other hand, a former economist at Apple’s Treasury Department, Martin Sullivan, revealed that the company went out of its way to ensure that it tax evasion would go unnoticed. ”Because tax avoidance of that magnitude – even though it’s legal and permissible – isn’t in keeping with the image of a socially progressive company.” said Sullivan while speaking to The New York Times.