Two prominent American politicians have completely dismissed claims by the Irish government that Ireland is not a tax haven for multi-nationals.

Democratic Senator Carl Levin and former presidential candidate Senator John McCain have rejected the response in the on-going row over Apple’s tax returns.

Ireland’s US ambassador Michael Collins had written to a Senate sub-committee in Washington last Wednesday when he rejected claims that Ireland is a ‘tax haven’.

The letter from Ambassador Collins said Ireland did not fit any of the four key indicators of a tax haven as identified by the OECD.

Now Senators Levin and McCain have responded to the letter and dismissed the Irish government’s claims.

They evidence it had heard recently about Ireland met a ‘common sense’ definition of a tax haven.

The Irish Times reports that the letter, addressed to chairman Levin, contested evidence heard by the Senate subcommittee on permanent investigations during its recent hearings into Apple’s tax affairs.

The subcommittee had heard evidence of a ‘special deal’ negotiated years ago by Apple with the Irish government.

Levin repeatedly described Ireland as a tax haven at sub-committee meetings.

In his letter, Ambassador Collins said a memorandum prepared for the subcommittee’s hearings into Apple’s tax affairs had calculated the tax rates paid by Apple subsidiaries in Ireland by reference to their entire profits.

He said this was despite the fact that the same memorandum clearly stated that the companies were not tax-resident in Ireland.

He wrote: “The tax rates attributed to Ireland are wrong and misleading. The memorandum went on to refer to Ireland as a tax haven, based on this misleading analysis.

“As you will be aware, the OECD has identified four key indicators of a tax haven. None of these criteria applies to Ireland.”

Levin and McCain issued a formal response on Friday. They said the records obtained by the subcommittee clearly showed that, for years, Apple paid the Irish tax authorities a nominal rate of corporation tax, far below the Irish 12.5 per cent rate.

Their statement said: “Testimony by key Apple executives, including CEO Tim Cook and head of tax operations Phillip Bullock, corroborates that Apple had a special arrangement with the Irish government that, since 2003, resulted in an effective tax rate of 2 per cent or less.

“Most reasonable people would agree that negotiating special tax arrangements that allow companies to pay little or no income tax meets a common-sense definition of a tax haven.”