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Apple's 'tax avoidance' days may be numbered

Karen Haslam | Feb. 20, 2013
New reforms in the UK, Germany and France may make it more difficult for Apple and others to avoid paying tax in European countries.

New reforms in the UK, Germany and France may make it more difficult for Apple and others to avoid paying tax in European countries.

The British, French and German governments have launched a joint initiative to crack down on tax avoidance. The plan was unveiled at a G20 meeting in Moscow this weekend.

It is designed to stop big firms that "country-hop to pay less tax" writes Reuters.

Governments are facing public outrage over how some multinational companies are handling their tax affairs. In Britain Starbucks, Apple, Google and Amazon have come under fire recently for using complex inter-company transactions to cut their tax bills.

Apple is said to direct its money through offshoots in low-tax countries and tax havens, such as the British Virgin Islands. According to reports, Apple avoided more than £550 million in tax in Britain last year.

Apple has been accused of paying only 2% tax in the UK.

British finance minister George Osborne will join forces with the German Finance Minister Wolfgang Schaeuble and French Minister Pierre Moscovici to examine ways to close the loopholes that have made it easy for companies to decide where they paid taxes, particularly on "mobile income" such as interest, dividends and royalties, according to the Reuters report.

The plan will be presented to the G20 finance leaders at a meeting in July.

 

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