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IRD will study Apple ruling: Key

NZ Newswire logoNZ Newswire 31/08/2016

New Zealand tax officials will be taking a close look at the European Union's ruling that Apple must pay 13 billion euros ($NZ20 billion) in taxes to the Irish government, Prime Minister John Key says.

The EU regulators on Wednesday ruled that a special scheme to route profits through Ireland was illegal state aid, Reuters reports.

"Ireland granted illegal tax benefits to Apple, which enabled it to pay substantially less tax than other bussinesses over many years," the regulators said.

Apple and the Irish government have said they will appeal the ruling.

Mr Key says he doesn't know whether there's anything that can be taken from the ruling.

"No doubt our officials will go and look at exactly the loophole they are closing down, and how they have decided to apply that tax liability," he told reporters.

"But every country's tax rules are different and Apple will be a much more significant multinational in Ireland than it is in New Zealand ... I'm sure our officials will have a look and see if there are any learnings they can take from it."

Asked whether multinationals were paying their fair share of tax in New Zealand, Mr Key said they probably were.

"I don't have any advice that they're doing anything illegal, that's for sure," he said.

Mr Key says the issue is the mismatch between tax rules in different countries and whether that's something multinationals can use to their advantage.

"If they are, then we would say on balance that's not fair, even if it's legal."

Mr Key says New Zealand is working with the OECD to close loopholes, which is the best way to deal with the issue.

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