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

Discussion in 'Politics, Religion, Social Issues' started by MacRumors, Oct 7, 2013.

  1. macrumors bot

    MacRumors

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    Following several months of investigation, the Securities and Exchange Commission (SEC) has concluded its review of Apple's finances and opted not to take any action against the company at the current time, reports AllThingsD.

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    While the SEC has ultimately decided that Apple's disclosures are sufficient, it has asked Apple to improve the language of its SEC filings to make it easier for investors to understand the risks of its tax strategies. As noted by The Wall Street Journal, Apple has agreed to provide the information, detailing the names and tax rates of the countries where it maintains foreign cash.
    The investigative conclusion by the SEC comes after much scrutiny from the U.S. Senate Permanent Subcomittee on Investigations this past summer, which claimed Apple avoided paying $74 billion in taxes between 2009 and 2012 through the use of international subsidiaries and complicated tax strategies.

    Apple CEO Tim Cook, CFO Peter Oppenheimer and Head of Tax Operations Phillipp A. Bullock all appeared in front of the subcomittee on Capitol Hill in May, with the company releasing a statement prior to the hearing about its international and financial operations. During his testimony, Cook told the senate that Apple pays all of the taxes that it owes in the country.

    In April, Apple borrowed $17 billion in a bond offering, in part to return cash to shareholders without bringing a portion of its $100 billion overseas to the United States. While Apple holds approximately $145 billion in cash and investments, roughly two-thirds of that money is currently held in foreign countries and would be subject to significant taxes if it were to be returned to the United States, with the bill estimated to have been at $13 billion if it were enforced.

    Apple told the SEC that it plans to use its foreign cash to invest abroad, creating additional Apple Stores overseas, expanding its iTunes Store, and boosting its international marketing.

    Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

    Article Link: SEC Concludes Review of Apple's Tax Policy, Asks for Additional Information for Investors
     
  2. macrumors 68000

    VulchR

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    #2
    How about spending some money on improving non-US versions of Siri, Maps, etc.?
     
  3. macrumors 68000

    iGrip

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    #3
    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.
     
  4. macrumors 6502a

    skywalkerr69

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    #4
    I have never had a problem with the language in any of their SEC filings. If you understand how to read a 10K, among other financial reporting reports, you will comprehend the language.
     
  5. macrumors 65816

    furi0usbee

    Joined:
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    #5
    Or use some money to go and buy Dropbox, rebrand as iCloud, and let my data sync properly.

    ----------

    The problem isn't reading the language... it's trying to read between the lines when a direct statement/admission would be best for shareholders.
     
  6. macrumors 68000

    ThunderSkunk

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    #6
    I look forward to the day the average citizen can use the Double Irish loophole to avoid paying taxes too. Shell corps in Belize all around!

    How to pay for the USA? Sell the country to China! Easy.
     
  7. macrumors 6502a

    skywalkerr69

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    #7
    Apple owners are fund managers and pensions managers. They know how to read reports.

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    Nobody has ever had an issue "reading between the lines" this is a common practice for all companies. There is and was no issue here.
     
  8. JAT
    macrumors 603

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    #8
    Are you of the opinion that throwing money at people makes them work better? Or faster? Seems to usually be the opposite.
     
  9. macrumors 6502

    Joined:
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    London, UK
    #9
    I keep hearing companies blamed for avoiding tax using perfectly legal tax avoidance methods.

    I wish people would BLAME THE GOVT, if they want to bitch about it. The GOVT set the rules in place, so it's the govt's fault if companies then follow their laws!

    Same crap with the Public Accounts Committee here in the UK — bloody politicians blaming the big companies for avoidance, in order to make their own political careers, rather than actually doing something to change the laws these companies (and any other company that they compete with!) has to follow.

    ...of course the political subcontext is, they know they cannot change the tax laws, without forcing more and more large companies to go to tax shelters anyway. So it's really all a petty-politics merry-go-round that'll achieve absolutely nothing; you watch.
     
  10. macrumors 65816

    Joined:
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    #10
    SEC Clears Apple’s Tax Strategy
    headline from AllThingsD

    SEC finds Apple didn’t create “the Holy Grail of tax avoidance” after all
    headline from 9to5mac


    and here on MacRumors...
    SEC Concludes Review of Apple's Tax Policy, Asks for Additional Information for Investors


    Quite an interesting difference in the spin, one of these headlines sounds like it was written by an android user. :)
     
  11. macrumors 68040

    Gasu E.

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    #11
    I think you misunderstand the use of the word "language." The SEC is looking for a more detailed discussion of risks.
     
  12. VulchR, Oct 7, 2013
    Last edited: Oct 7, 2013

    macrumors 68000

    VulchR

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    #12
    No. I am of the opinion that using dodgy foreign partners rather than using in-house workers results in lower quality services for Apple's products outside the US. I'm pretty sure if Apple hired a few people, they can begin to actually remove the numerous POI errors that I and others have reported in the UK version of Maps. The same sort of thing goes for Siri and its lack of integration with sources of information about the UK. The information is there....

    See poll http://forums.macrumors.com/showthread.php?t=1640706 for users' experience reagrding Maps in the US versus outside the US.
     
  13. macrumors 65816

    furi0usbee

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    #13
    The problem is, well not a problem, because this is exactly what a corporation is supposed to do, is that as much as we all love Apple, like any company, their number one priority is to make a profit. If, along the way, customers are happy with the products, well that's a win-win.

    Do I think Apple is doing anything illegal? From everything they have said either in public or in front of congress, no. Do I think they are using every loophole and pushing every limit they can? Yes, but that's what a corporation is supposed to do.

    Of course for the people who hate Apple for X, Y, and Z, this looks extremely shady. And when Apple says they are using this money to invest overseas... if the truth is 100% of a statement, the true part of that statement is probably 5% true... maybe.

    The ONLY reason Apple keeps that money overseas is to avoid paying taxes, and if they could funnel 100% of US profits overseas to avoid taxes, they would. TC said he was open to paying some taxes on repatriation of cash, but the truth is, he would also prefer to pay ZERO taxes. But he couldn't say that in front of television cameras.

    I really don't like it when people talk patriotism about corporations. Apple could be really patriotic and make all their stuff over here. But they would be more patriotic than profitable. Apple, like every company on Earth, if you presented them with a business model of the highest quality products, with the lowest cost of manufacture (wages/materials/etc.), they all would be making their stuff in some third-world country.

    Funny though, nobody here would have money or a job to pay for all that stuff. So greed has a tipping point too!
     
  14. macrumors 6502a

    Joined:
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    FL
    #14
    I don't see why you can't do this now. Just start a global company and start selling your products all over the world. Should't be to hard to do for average people.
     
  15. macrumors regular

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    Minnesota
    #15
    I bet we don't see this plastered all over the media like they did with the claim they avoided paying taxes.
     
  16. macrumors 6502a

    giantfan1224

    Joined:
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    #16
    Give U.S. based multinational companies a tax holiday. Let them repatriate their foreign money for no or little tax. This will do a lot more to help the economy than any "stimulus" our govt. can think of.
     
  17. macrumors 65816

    aarond12

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    #17
    That's exactly what Apple has been lobbying for. I hope it happens.
     
  18. macrumors 68020

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    #18
    This an international problem that can't be solved by any one government alone. The UK government has no jurisdiction of Ireland's tax laws which is where Apple pays most of its tax in Europe.

    I agree that tax avoidance is not illegal. I haven't heard anyone say otherwise. It might be immoral but it's not illegal, although I do think that HMRC could do a lot more to close some of these loopholes and push for international tax agreements through the G20.
     
  19. macrumors 68000

    ThunderSkunk

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    #19
    Hahaha...

    Actually I have done that.
     
  20. macrumors 68020

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    #20
    I much prefer the more balanced editorial line taken on this website than some of the more vitriolic Apple fan websites.
     
  21. macrumors 6502a

    Ciclismo

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    Munich
    #21
    The way I see it is that by skirting taxes, companies are able to increase their profits, which essentially reduces the risks for stockholders, who in turn are (in general) individuals who are affluent enough to "risk" letting their money "work for them".

    These individuals aren't, however, always directly responsible for any profits, as they are in a position to offset the costs of using straw-men for shell-companies in tax havens.

    And if they do make a loss, this will be repatriated so that it can be used to offset any taxes they do have to pay in their country of residency.

    Fortunately for most governments, the majority of the population cannot afford to use the legal loopholes to reduce or even eliminate their tax debts. Seems like a rather effective mechanism for the rich to get richer, and for the rest to pick up the tab.

    It may not be illegal, but that doesn't mean it is ethically correct.
     
  22. theheadguy, Oct 7, 2013
    Last edited: Oct 7, 2013

    macrumors 6502a

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    california
    #22
    Honestly, just stop. This web site is so pro-:apple: I get nauseous occasionally. Just because one headline doesn't satisfy a childish attitude doesn't mean we all need to hear about it.
     
  23. macrumors 603

    Michael Goff

    Joined:
    Jul 5, 2012
    #23
    The fact that they have to move around developers sometimes, leading to some things getting delayed, tells me they probably don't have enough people working for them. Ergo, throwing money at the project might actually have a positive effect.
     
  24. JAT
    macrumors 603

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    #24
    People are people. What if they get dodgy employees? It isn't magic.
     
  25. macrumors 65816

    Joined:
    Aug 13, 2011
    #25
    I keep saying the same thing when they bitched about Google / Amazon and all the other corps. If they use a LEGAL loophole - guess what - close the damn loophole if you really care. BUT - every loophole would affect individuals sitting in those positions too - so I am sure they have a somewhat personal interest to keep the holes open.
     

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