A settlement of 318 million euros ($348 million) has been reached between the tax office of Italy and Apple after the latter failed to make its tax payments of six years. A deal is also likely to be signed by the iPhone and iPad manufacturer to outline protocols for making its tax payments from 2015 onwards.
The deal has been triggered by the strict measures being taken by the European Union and national governments to uncover the profit-shielding arrangements, which the multinational companies use to avoid the payment of taxes. The prosecutors appointed by the Italian government are probing onto the accusations of Apple not paying corporate taxes, worth 879 million euros, between 2008 and 2013. The tax payment failure was induced by a reduction in taxable income by booking the Italian profits through its subsidiary in Ireland.
As Apple reaches an accord with the tax agency of Italy, it is likely to help the company in a judicial investigation that involves three of its managers. The settlement is expected to positively impact the investigation procedure. The deal has come after Apple’s Irish operations are being threatened by an EU tax ruling. Ireland was held by the EU last year for bending the international tax rules as it allows Apple to shelter tens of billions of its profits in return for job security.
The company is also being condemned by its own country due to inversion deals, under which Apple has re-domiciled its tax base to another country. Apple, which earns offshore profits worth $181.1 billion, is likely to pay a tax of $59.2 billion in an effort to transfer money to homeland.