WASHINGTON: Europe’s order for Apple to pay €13bil (RM59.95bil) in back taxes could provoke US tax reforms and a significant break for firms repatriating offshore earnings, US Treasury Secretary Jacob Lew said. Lew said high US corporate tax rates drive companies to seek tax havens like Ireland, which offered Apple what the European Commission ruled was an illegally low rate to encourage it to invest there. While he said that the EC move essentially raided potential US government tax receipts, Lew said the episode should give a boost to efforts to reform the US system. ”I would hope that the idea that a European Commission action will reach into our tax base and take US tax revenues and make them European tax revenues will help trigger this debate about tax reform,” Lew said in a talk at the Council on Foreign Relations. Lew said he expects Washington to craft a one-off discount for the repatriation of offshore profits in the next year in order to bolster government revenues.

Source: The Star September 13, 2016 10:05 UTC