"Tax avoidance is not illegal," he said. "There's nothing wrong with that. There's nothing immoral with that. It's the system that Congress has set up."

Coburn called for Congress to overhaul and simplify the tax code.

Levin, however, questioned the efforts of Microsoft and HP. In Microsoft's case, the company charges three foreign subsidiaries large licensing fees to sell its products. In 2011, two of those subsidiaries, in the low-tax jurisdictions of Ireland and Singapore, paid about US$4 billion for those licenses, then sold products worth $12 billion, even though U.S. tax law requires the subsidiaries to pay fair prices for the transfer of assets, Levin said.

That allowed Microsoft to move $8 billion in profits offshore and out of U.S. tax jurisdiction, he said.

Microsoft also sells licenses to its subsidiary in Puerto Rico, which then sells the distribution rights of Microsoft products back to the U.S. parent company at a profit, Levin said. Last year, 47 percent of the U.S. sales of Microsoft products were shifted to Puerto Rico, he alleged.