Reports: Apple facing EU tax probe, building huge ad team

|About: Apple Inc. (AAPL)|By:, SA News Editor

Irish broadcaster RTE reports the EU will launch a formal investigation of Apple's (AAPL +0.6%) Irish tax arrangements.

Apple's use of favorable Irish tax laws allowed it to pay just a 3.7% tax rate on non-U.S. income during its last fiscal year. That, in turn, is a big reason $132.2B of Apple's $150.6B  cash balance at the end of FQ2 was offshore.

Tim Cook was grilled by Congress last year over Apple's offshore tax payments; Cook responded in part by calling for an overhaul of the oft-criticized U.S. corporate tax code.

Meanwhile, AdAge reports Apple is "madly building an internal [ad] agency that it's telling recruits will eventually number 1,000 [employees]," and by doing so is set to move projects away from historical agency partner TBWA/MAL.

Apple has also reportedly invited other agencies to collaborate on big projects, as it tries to overhaul its marketing after recent campaigns failed to meet expectations.

In e-mails unearthed during the latest Samsung trial, marketing chief Phil Schiller voiced concerns about Samsung's ad campaigns, and also asked Cook if Apple should replace TBWA/MAL.

Earlier: Morgan Stanley forecasts strong FQ3 iPhone sales