Apple defends Holy Grail of tax avoidance

Apple chief Tim Cook faced a grilling over  "sham" subsidiaries and "convoluted" strategies to shift profits offshore, but denied the company uses "gimmicks" to cut taxes, according to an article in smh.com.au.

Cook told a US Senate hearing Apple lives up to its tax obligations and more, but some lawmakers expressed outrage over findings of the panel's probe that the tech giant avoided taxes by using a web of foreign subsidiaries, some without any tax jurisdiction.

Senator Carl Levin, chairing the hearing, said the investigation found a disturbing pattern of shifting profits, despite denials by Cook and other Apple executives.

"Of course you shifted something, the most valuable thing you have, the intellectual rights of your company," Levin told Cook and two other Apple executives called before the Senate Permanent Subcommittee on Investigations.

Levin said the report showed Apple shifted profits to offshore entities which were "a sham and a mere instrumentality of the parent."

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