EU set to announce investigation into Apple tax arrangments in Ireland

The European Commission is due to announce an investigation into Ireland's tax arrangements with Apple tomorrow. While the Department of Finance has declined to comment, it's understood the Commission will confirm tomorrow that it will be looking specifically at Apple's tax arrangements here.

Last year the EU's competition authority said it was looking into corporate tax structures in a number of member states including Ireland.

Speaking on Friday, Taoiseach Enda Kenny said that should any probe be initiated, the country’s taxation regime would be defended “very strongly”.

Mr Kenny was in California where he met with senior management from the US tech giant, including chief executive Tim Cook, with whom he discussed the matter "in a general way".

“This [ISSUE]applies not just in the case of Ireland but across quite a number of countries and the information-gathering process that has been under way has been fully endorsed by Ireland,” he said.

“Clearly, when the commission decide to make a statement about this, we will react to it.”

That statement is expected to take place tomorrow with an investigation likely to focus on the tax arrangements that Ireland, Luxembourg and the Netherlands use to attract foreign companies.

A US senate committee investigation revealed last year that Apple had cut billions from its tax bill by declaring companies registered in Cork as not tax resident in any country.

Senator Carl Levin, chairman of the subcommittee, said this arrangement represented "the holy grail of tax avoidance".

Apple’s Irish arrangement helped it achieve an effective tax rate of just 3.7 per cent on its non-US income last year, its annual report shows - a fraction of the prevailing rates in its main overseas markets. Apple has said it complies with the law.

Mr Kenny has described the company as a “very important employer” in Ireland with more than 4,000 people.