Ireland has announced plans to close the loophole which has allowed technology giant Apple to save tax on more than $40bn ($25bn) of offshore income over four years by declaring that companies registered in Cork were not resident for tax purposes in any country.

Speaking during his 2014 Budget speech to parliament in Dublin yesterday Michael Noonan, Ireland's Finance Minister, said: 'Aggressive tax planning by companies is a major issue for legislators across the world and it needs to be addressed. Ireland is very much involved in the process of addressing the issue.

A paper Ireland's International Tax Strategy was published at the same time and says that so-called 'stateless' companies for tax purposes that are incorporated in Ireland will either have to declare a tax residency in another jurisdiction or pay Ireland's 12.5% corporation tax rate in 2015.

In his Budget speech, Noonan said: 'Let me be crystal clear, Ireland wants to be part of the solution to this global tax challenge, not part of the problem. I want Ireland to play fair, as we always have done. And I want Ireland to play to win.'

Apple's tax arrangements for its Irish subsidiaries were heavily criticised earlier this year during a US Senate committee investigation on corporate tax avoidance. At the time, Senator Carl Levin said Apple had used 'a complex web of offshore entities' to achieve the 'holy grail of tax avoidance'. Apple chief executive Tim Cook said the company had not acted illegally and paid 'all the taxes we owe - every single dollar'.

Google and Microsoft have also established Irish-registered subsidiaries, which make sales to customers and are designated as tax resident in Bermuda. The subsidiaries pay large, tax-deductible sums of money in royalties to their Bermuda tax-resident affiliates, ensuring that profits are channelled to the zero-tax jurisdiction.