Apple chief calls on US government to slash US corporate tax

In a dramatic display of how threats from multinational corporations are driving down taxes across the world, chief executive Tim Cook warned Congress that he would refuse to repatriate a total of $100bn stashed offshore unless it acted to slash the 35% US rate.

Cook said the tax rate for repatriated money should be set "in single digits" to persuade companies to bring it back. Standard tax for US profits should be, he said, in the "mid 20s".

He also revealed that Apple had struck a secret deal with the Irish government in 1980 to limit its domestic taxes there to 2%.

Three subsidiaries based in Ireland are also used to shelter profits made in the rest of Europe and Asia but are not classed as resident in any country for tax purposes - a tactic dubbed the "iCompany" by critics, The Guardian reports.

Cook's testimony to a Senate sub-committee investigating multinational tax practices largely confirmed its findings that Apple had taken tax avoidance to a new extreme by structuring these companies so they did not incur tax liabilities anywhere.

Phillip Bullock, the California company's head of tax, estimated that just one of these subsidiaries - Apple Operations International - had channelled $30bn in global profits over the last five years without filing a single income tax return.

The only taxes paid were on the interest earned by the cash pile and small sums in local markets. Senate investigators allege a total of $70bn has been sheltered this way in four years.

Despite heated exchanges with committee chairman Carl Levin, Apple largely shrugged off criticism of the practice, insisting it was acting "in the letter and the spirit of the law".

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