The Irish ambassador denied on Friday that his country is a "tax haven" or that it has given special tax breaks to Apple.
The senators held a hearing last week to examine Apple's methods for avoiding billions of dollars in taxes. The subcommittee's investigation found that Apple funnels much of its revenue through a network of subsidiaries in Ireland that pay little or no taxes.
Collins argued that Ireland's tax system is set in law, and the country does not negotiate special rates for specific companies.
"All tax resident companies in Ireland are liable to corporation tax on their chargeable income at the rate of 12.5% on trading income and at 25% on non-trading income," Collins wrote.
He claimed that the tax rates attributed to Ireland in the subcommittee's report are "wrong and misleading."
He also argued that Ireland fails to meet the international criteria for a "tax haven."
Collins said Ireland is "fully supportive of international efforts" to crack down on corporate tax dodging.
According to the subcommittee's investigation, Apple exploited a difference between Irish and U.S. tax rules. Ireland taxes companies based on whether they are managed or controlled in the country, whereas the U.S. bases residency on the entity’s place of formation.
Apple claims that the subsidiaries were formed in Ireland but are managed in the U.S., meaning that they don't have to pay taxes to any government.
One entity, Apple Operations International, made up 30 percent of Apple's total worldwide net income from 2009 to 2011 but did not pay any corporate income tax during that time period, the Senate investigators found.
“Records obtained by the subcommittee clearly reflect that, for years, Apple paid Irish tax authorities a nominal rate, far below Ireland’s statutory rate of 12.5 percent, on trading income," Levin and McCain said in a statement responding to the letter from Ireland.
"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 percent 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.”
During last week's hearing, Cook denied that his company uses "tax gimmicks."
"We pay all the taxes we owe, every single dollar," he said. "We not only comply with the laws, we comply with the spirits of the laws."