NOW that tech darling Apple Inc has been dragged front and center into the debate over the US tax code, lawmakers are hoping that the spotlight on such a high-profile company could be the catalyst for Congress to take action to close loopholes or reform the law.

At a hearing on Tuesday, members of the Senate Permanent Subcommittee on Investigations grilled Apple CEO Tim Cook over allegations that the company's Irish subsidiaries help it avoid billions in US taxes. It was a moment of high drama, a CEO of the world's most valuable company testifying before Congress for the first time ever. Cook did so voluntarily. And he parried the volley of questions from senators, insisting that the company's overseas operations have nothing to do with reducing Apple's US taxes.

"We pay all the taxes we owe - every single dollar," Cook said. "We don't depend on tax gimmicks."

The subcommittee released a report on Monday that held up Apple as an example of the legal tax avoidance made possible by the US tax code. Apple paid US$6 billion in taxes last year. But the subcommittee estimates that Apple avoided at least US$3.5 billion in US federal taxes in 2011 and US$9 billion in 2012 by using its tax strategy, and described a complex setup involving Irish subsidiaries as being a key factor.

The result, said Senator John McCain: "Apple has over US$100 billion, more than two-thirds of its total profits, stashed away in an offshore account."

The focus on Apple's taxes comes at a time of heated debate in Washington over whether and how to raise revenues to help reduce the federal deficit. Many Democrats complain that the government is missing out on billions of dollars because companies are stashing profits abroad and avoiding taxes. Republicans want to cut the corporate tax rate of 35 percent and ease the tax burden on money that US companies make abroad. They say the move would encourage companies to invest at home and thus spur the economy and job market.

"America's tax system is broken and uncompetitive," said McCain, the subcommittee's senior Republican. "The egregious loopholes that exist in the tax code must be closed so that the nearly US$1 trillion in untaxed overseas profits can come back to the United States."

Apple's enormous, iPhone-fueled profits mean that it has more cash stashed overseas than any other company: US$102 billion. And Cook reaffirmed Apple's position that it has no intention of bringing that cash back to the US at the current tax rate. Like other companies, it has a responsibility to shareholders to pay as little as possible in taxes. In effect, Apple is holding out for a lower corporate tax rate, and Cook spent time to advocate for one, as well as a streamlining of the tax code to eliminate deductions and credits.