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Apple under investigation in Italy for tax fraud

Authorities in Italy are believed to have seized equipment from Apple's Italian headquarters as part of ongoing investigations into claims that the US tech giant failed to report €1 billion (£840 million) in taxable income.

First reported in the Italian newspaper L'Espresso, the allegations were confirmed yesterday by Reuters from judicial sources with direct knowledge of the matter.

"Checks on the size of the tax are under way," the source said. "There is a global process under way and the Italian tax authority is one of the most active.

"In general, the focus is shifting towards multi-nationals that are able to lower their tax base through their international operations."

Prosecutors in Milan apparently claim that Apple hid €206 million (£173 million) in 2010 and €853 million (£715 million) in 2011 from the local tax authorities.

In a statement, the company said: "Apple pays every dollar and euro it owes in taxes and we are continuously audited by governments around the world.

"The Italian tax authorities already audited Apple Italy in 2007, 2008 and 2009 and confirmed that we were in full compliance with the OECD documentation and transparency requirements. We are confident the current review will reach the same conclusion."

The source claims that Apple funnelled part of its profits made in Italy through Apple Sales International (ASI) in Ireland in order to lower its taxable income.

Last year, it was revealed that Apple avoided paying corporation tax in the UK through the same subsidiary in Ireland, paying just two per cent corporation tax outside the US.