updated 02:05 pm EDT, Tue June 10, 2014
Regulatory officials concerned that Ireland offered low tax rates as incentive
Europe's antitrust and consumer investigation agency, the European Commission, is allegedly opening up an inquiry into Apple's tax practices in Ireland. The review reportedly magnifies existing efforts looking at the business arrangements of many multi-national companies that have a presence in Ireland, and will focus on whether Apple was given special tax treatment to set up shop.
US Senators, led by John McCain (R-AZ), believe that Apple got an exceptionally lower tax rate in the country for its European headquarters, which helps it reduce its US tax burden. McCain had claimed that Apple negotiated a deal with the Irish government back in 1980 to lower the tax bill of the Ireland-based holding company that manages most of Apple's foreign operations to two percent.
Both Apple and the government of Ireland refute the claims. The iPhone maker points out that it has had offices and production facilities in Ireland since the 1980s, long before any recent corporate tax rates or changes in the law have taken place. An announcement of the probe is expected as early as June 11, reports RTE News.