WASHINGTON (MarketWatch) -- Apple Inc. AAPL, -1.59% avoided "billions of dollars" in U.S. taxes by setting up offshore entities, a Senate report charged Monday. "Apple sought the Holy Grail of tax avoidance," said Sen. Carl Levin, chair of a Senate panel that will hold a hearing about offshore profit shifting on Tuesday. "It has created offshore entities holding tens of billions of dollars, while claiming to be tax resident nowhere," Levin said. Apple earlier Monday said it does not use tax gimmicks and that its Irish subsidiary isn't a shell company. The report charges Ireland is an offshore tax haven for Apple.