Apple's chief executive Tim Cook has told a US Senate committee it pays all the tax it is required to. The firm was accused of being "among America's largest tax avoiders" by the committee. Apple said it will pay more than $7bn in US tax this year.
After questioning Apple CEO Tim Cook in a congressional hearing into their tax affairs, Senator John McCain said he was sorry they had run out of time as he had been meaning to ask a question that seemed to have been troubling him. As the hearing ended he said:
"What I really wanted to ask is why the hell I have to keep updating the apps on my iPhone all the time and why you don't fix that?"
Cook responded the company was "trying to make them better all the time."
Apple said in a comment posted online that it does not use "tax gimmicks." It said the existence of its subsidiary 'Apple Operations International' in Ireland does not reduce Apple's US tax liability and the company will pay more than $7 billion in US taxes in 2013.
In submitted testimony ahead of the hearing, Apple said any tax reform should favour lower corporate income tax rates regardless of revenue, eliminate tax expenditures and implement a "reasonable tax on foreign earnings that allows free movement of capital back to the US."
"Apple recognizes these and other improvements in the US corporate tax system may increase the company's taxes," it said.
Apple has been accused of employing a group of affiliate companies located in Ireland to avoid paying billions of dollars in US income taxes, a Senate investigation has alleged.
According to the report, Apple is holding around $102 billion of its $145 billion in cash overseas, and an Irish subsidiary that earned $22 billion in 2011 paid only $10 million in taxes.
But the committee said there was no indication Apple had done anything illegal. Many other multinational corporations use similar tax techniques to avoid paying US income taxes on profits they make overseas.
But the report found that Apple uses a unique twist, and lawmakers are raising questions about loopholes in the US tax code.