|Jesse Drucker of Bloomberg News reported in 2010 that Google Ireland Holdings listed as its directors, two attorneys and a manager at Conyers Dill & Pearman, a Bermuda law firm, based at Clarendon House, Church Street, Hamilton. It is also home for Microsoft's Irish subsidiaries in Bermuda.
Corporate Tax Avoidance: Last week the news that Apple is considering buying
Beats Electronics, a maker of expensive headphones that was founded by record
mogul Jimmy Iovine and rap artist Dr Dre, for $3.2bn, got a lot of media
attention. Dr Dre must have pissed-off Apple when he bragged on video about
becoming the “first billionaire in hip-hop” as the hyper-secretive hunter
had not concluded the deal while market analysts were largely sceptical. In
Ireland Dr Dre had got attention in 2012 when Beats' international holding
company was established in a virtual sense in the coastal town of Clonakilty in southwest Ireland with
the tax residency in the British island of Jersey. It has since moved to Dublin
where there is expertise to maintain tax-dodging Irish offshore companies as
stateless despite an apparent legislative attempt to end this loophole in Irish
law late last year.
reported last Friday that Beats Electronics Holding Limited had revenues of
$1724m in 2012 and profit before tax of $8,2m.
It paid the Irish Revenue
$537,563 in tax even though its presence in Ireland is only as a mailbox
In May 2013, the US
Senate’s Permanent Subcommittee on Investigations revealed how Apple was using
Irish offshore companies that it considered as 'stateless' -- not obliged to
report to any tax authority in the world -- to route much of its overseas income
Ireland said last October
that a provision in a Finance Bill was designed to close the 'stateless'
loophole but it didn't impact the Irish companies in West Atlantic tax havens
that are part of the 'Double
Irish Dutch Sandwich'
Tax residency of Irish
offshore companies depends on where the companies are "managed and controlled"
-- this is usually a fiction as the Irish companies of Microsoft and Google in
Bermuda, Facebook in the Cayman Islands, Apple in the British Virgin Islands or
Beats electronics in Jersey,
Apple presented its Irish
offshore companies with Apple in teh name as normal Irish companies with
addresses at its Irish operational headquarters in Cork.
Seamus Coffey, an economist at University College
Google Ireland Holdings (GIH), an Irish company, is not resident in Ireland
because it is not managed and controlled in Ireland. "However, nor can GIH be
resident in Bermuda because it is not incorporated there. GIH is 'stateless' but
instead of doing it in Cupertino, California as Apple did with Apple Sales
International, Google is doing it in Hamilton, Bermuda. In reality, Google is
doing it in Mountain View, California but unlike Apple goes to the limited
effort of having a brass-plate operation in Bermuda and maybe the odd board
meeting and AGM there. Apple may not have to do likewise."
here that despite the amendment to the Irish law last year to ensure that an
Irish offshore company should be tax resident somewhere, stateless Irish
companies continue to exist.
OECD BEPS Project: Ireland should embrace corporate tax reform --
including how Apple and rappers like Dr Dre are able to benefit from Ireland's