SEC Concludes Review of Apple's Tax Policy, Asks for Additional Information for Investors

ActionableMango said:

My entire post was a response to "flat tax is impossible to avoid", and has nothing to do with rates.

I agree with you that if the US tax rate was more in line with other countries, it would remove the incentive to offshore profit.

In the mean time, all the tax revenue from economic activity that couldn't be offshored anyway is also being reduced. So while you get your 15% of $100 billion you are also reducing from 35% to 15% of the revenue you were getting from everything else.

Also, such a move can trigger a race to bottom. For example if we switched to 15%, Ireland, missing all that tax revenue, figures 10% of $100 billion is also better than nothing. So they switch to 10%. Then Switzerland decides 5% of $100 billion is better than nothing, so they lower it to 5%. Then the Republic of Sealand figures 0.2% is better than nothing...

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Apple has about 50 billion onshore and around 100 billion offshore. If you're getting 35% of 50 billion that's 17.5 billion in total taxes. If you get 15% of 150 billion that's 22.5 billion in total taxes. 5 billion more tax dollars seems like a better deal, but that's just me. Not to mention all the extra jobs and spending that would be created. As far as your theory of a world competition for lower tax rates if the U.S. lowers it's corporate tax rate, well again it's a theory. If it did come to pass I say great. Less taxes means less government spying and less killing innocent people all over the world. That's a good thing.

MacDav said:

Less taxes means less government spying and less killing innocent people all over the world. That's a good thing.

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Less tax revenue will only result in greater deficit spending. The US government is hopelessly incapable of reducing spending by any meaningful amount.

ActionableMango said:

Less tax revenue will only result in greater deficit spending. The US government is hopelessly incapable of reducing spending by any meaningful amount.

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Well, if the Liberals and/or Rino's stay in power you are probably right. I'm hoping for a miracle that both will be kicked out in 2016. If not then it won't matter anyway cause the country will soon thereafter file for bankruptcy, and we'll all get a fresh start. Either that or the Zombies will start attacking.

iGrip said:

This is a positive development. The SEC is protecting Apple's owners from insufficient management transparency. Directing them to be more explicit about the risks is completely appropriate.

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Sure having the government "review" your corporate policies is a positive development in the opposite universe where having government bureaucrats rely on poorly written laws subject to wide interpretations to give you advice on things you want to do anyway is helpful. Like if the government comes into my house and gives me advice on how to clean my house or make my dinner. Or tell me how I should manage my health care needs...hmmmm.

We live in interesting times. The simplest explanation for this is probably political. Apple is too busy being a company and in our modern America all companies need to paying off the Man.

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Gasu E. said:

There are some valid arguments for this. However, there is a strong counterargument: this would encourage corporations to keep even more profit offshore in the future, waiting for the next tax holiday.

Really, a better fix would be just to remove all the corporate tax loopholes, especially ones earmarked for a particular industry; then lower the overall tax rate commensurately. The offshoring is partly due to the fact that the US has a high corporate tax rate, even though (seemingly paradoxically) US taxes collected as a share of profits are on the low side; both relative to other developed nations, of course.

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Today's "loopholes" are yesterday's carefully considered and reasoned exceptions to the law (sometimes they also just payoffs to certain industries). My point is often loopholes are not mistakes they are thoughtful and intentional. We should understand why they are there before we decry their results.

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mrxak said:

While I have no problem with added transparency for investors, I do hope the SEC will demand the same standard of transparency for every other corporation, and they're not merely singling out Apple.

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I really wish the government would face the same finial scrutiny as government. Imagine if the government CEO was taken to jail every time they lied about a government program or finances. I could get behind that.

jimbobb24 said:

I really wish the government would face the same finial scrutiny as government. Imagine if the government CEO was taken to jail every time they lied about a government program or finances. I could get behind that.

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Consider that no one went to jail over their sub-prime lending scams on either side. I wouldn't paint things like CEOs are always going to jail. It seems quite rare. They wouldn't be so bold if they expected to do real jail time.