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I was thinking the exact same thing... Apple is thinking "35%? For what? Why should I cut someone else in on my cash flow when I earned it all myself?"

because you didn't earn it all yourself. steve jobs does not personally create designs, mine for metal, then mold those metals into a product. then open his own personal store and man that store to sell it to customers.

people do that. a product is created by the help of hundreds of thousands of people. hundreds of thousands of people who do not all equally share in the profits.

in before some libertarian or capitalist rhetoric. im not advocating socialism or whatever, im simply saying that Apple is morally obligated to pay ATLEAST SOME taxes.
 
Because in broad and general terms, the poor don't pay any taxes at all. Your mileage may vary, but this is largely true.

Not true. They may not pay income tax but they pay gas tax, sales, tax, car registration tax, payroll tax and, if they own a home, property tax. Even if they rent a part of their rent pays the property tax.


Their aim is to win a one-year tax amnesty on their foreign earnings, allowing them to repatriate that money at a tax rate of about 5%, instead of the 35% they face now

Actually, Apple pays on the order of a 25% tax rate. 35% is the theoretical maximum before any deductions occur. I think they ought to pay the tax same as the rest of us.
 
Has anyone dug through Apple's financials to see what their actual tax rate was recently?

I don't delve into reports like I used to, but I recall consistently seeing tax rates in the high teens or low 20s for most of the companies I researched.

I recall the pharmaceutical industry's rate was crazy-low.

Whenever anyone complains of the 35% rate as if that is the rate truly paid, I find it disingenuous. If slashing corporate taxes has merit, there is no need to tarnish the discussion by starting with such a deception.

Also, there is a difference between earning money overseas and employing creative bookkeeping so as to disguise money earned in the U.S. I don't know that Apple does that, but it would not be unusual in the corporate world.

*moc67
 
This is just an example of how relatively high taxes can lower revenues. The government isn't getting a penny of Apple's overseas money, whereas if they had these taxes at a more reasonable level they could be getting money directly in taxes, and indirectly through it's usage in the American economy. Having the taxes so high doesn't do the government or its people any good.

I agree. Can we lower my income tax rate from 35% to 5% please? No? Why not? It's way more "reasonable" don't you think? Oh, I can't get mine at 5% because I'm not a wealthy company that can buy congressional votes. Got it.
 
Because in broad and general terms, the poor don't pay any taxes at all. Your mileage may vary, but this is largely true.

This is just wrong.

The poor pay little income tax, but the pay payroll tax, social security tax, medicare tax, etc. It's a canard to say that just because one doesn't pay much (or no) income tax, one doesn't "pay any taxes at all." In fact, the poor are saddled with the most regressive taxes of all.
 
This is just wrong.

The poor pay little income tax, but the pay payroll tax, social security tax, medicare tax, etc. It's a canard to say that just because one doesn't pay much (or no) income tax, one doesn't "pay any taxes at all." In fact, the poor are saddled with the most regressive taxes of all.

They also spend a higher proportion of the post taxed income on basic survival products: food etc, which get (typically)... taxed some more.
 
They also spend a higher proportion of the post taxed income on basic survival products: food etc, which get (typically)... taxed some more.

Most states that I know of have LOWER taxes on those items. Illinois goes from 6.25% down to 1% for food and medicine.
 
Most states that I know of have LOWER taxes on those items. Illinois goes from 6.25% down to 1% for food and medicine.

Many states have grocery exceptions but not prepared exceptions, which many families rely on due to longer working hours and lack of good child care etc.
 
If that's what you think 'trickle-down economics' is, then wouldn't it be best for Apple to pay the 35% tax to the US Government, or spend it all on infrastructure in the US? This would have a positive trickle-down effect to Apple's own benefit.

Umm, no. I think you need to go back and read what I wrote again.

"You give the large corp a break on the money it already has so that it will spend..."

Why would taxing it be giving Apple a break? And why would Apple not try and work to it's own advantage? Wouldn't you? I bet if you found a loophole that allowed you to pay only a fraction of the taxes you were supposed to you would take it.
 
Apple can shut the #$#@ up and pay their taxes. The advantages of being based in this country and the responsibilities of being based in this country go hand in hand. When I get my paycheck, I don't argue with the government over my tax rate because I "earned" the money. Earning the money does not erase my responsibility as a citizen to pay taxes on it. A few other points:

- Just because something is legal in America doesn't mean it isn't corrupt and wrong. Hiring lobbyists so they can legally dodge their taxes doesn't mean they're not dodging their taxes. The American people get screwed on the deal regardless of how legal those corporate puppets in Congress proclaim it to be.

- 5% versus 35%. Do they have anything concrete to offer the American people in exchange for this possible reduction of funds going into programs like Social Security and Medicare, you know, things that provide services like healthcare to poor people? Remember poor people? The ones who can't afford to fly across the country at a moment's notice in their private jet for an organ transplant?

- Here's a company that's famous for sitting on cash and not putting it back into the economy, asking for a tax break so that it can have more cash, and claiming they're going to put it back into the economy. In what twisted netherworld of bass-akwards logic does this make any sense? "Hi, I'm the medical doctor that is famous for not dispensing medical supplies. I deserve to have more medical supplies, so that I can dispense them to people." How about we find the company/doctor that IS putting money into the economy/dispensing medical supplies, and give them what they need? Instead of just pouring the money down a black hole of corporate greed and corruption?

- This is the legacy of the great Apple, who made computers usable for the average person instead of the professional geek? Overpriced luxury goods, closed ecosystems, anti-competitive behavior, and ruthless corporate greed? This company is not your friend, people. It is a very big fish in the sea of capitalism. The products make you feel warm and fuzzy because that's what gets you to buy the products, which is what makes money for the shareholders, which is what Apple is legally required to do. That's the system. It breeds corruption. Apple is not immune.

A deduction is already in the law. While that doesn't necessarily make it right, I'm not bastardizing our democracy by dumping a pile of money on some lobbyist attack dog outfit to get the deck stacked in my favor, at the expense of the taxpaying public. It's ok to seek advantage, within the law and also within some sense of reason and decency. Apple claims this tax break is reasonable and decent, but a basic examination of their motives as a corporation easily exposes that hypocrisy.




First off, they are NOT using existing deductions and IRS rules, they are trying to get the rules changed to favor them and their friends. Secondly, I made it pretty clear what I meant by dodging taxes, regardless of what the term connotes to you. Since you seem to prefer your own meaning of the term, I will re-state the essence of the point: they are trying to get out of paying the amount of tax that is legally required of them, and the methods that they are using to do that, while legal, are no less repugnant or morally objectionable for that fact. Please refer to my earlier statement which is essentially this: just because something is legal in America does not mean it is right.

Consider this: It's legal for a corporation to take out a life insurance policy on a terminally ill employee, without notifying that employee's spouse. Furthermore, when that employee dies, it is legal (and very common) for that corporation to cash the insurance check and not turn over a single penny to the widow. Does that strike you as right? No? Well, too bad, because it's legal. And guess who gets to make those laws? Corporations and their lobbyists, with a compliant Congress. You're free to think that's alright, but to suggest that I'm being reckless with someone else's money because I'm tired of watching them use it to enrich themselves at the expense of this country - that seems an awful lot like throwing around words.

Good Posts. It seems only reasonable that Apple and the rest of these corporations pay their taxes. The George Bush Era spoiled these and other corporations.
 
I can imagine this being fairly contentious. On the one hand - it would be great for the US economy to have that kind of cash injection. On the other - why should the 'rich' pay less tax; while the poor pay more?

Can you imagine that the trillion they are talking about is probably on the low ball and its 2 or 3 times more. :eek:

When are humans and for that mater companies fair? :D
 
There's a simple concept from Econ 101:
Taxes discourage an activity

So it's obvious that the 35% tax discourages corporations from repatriating their earnings. Think about it: Say Apple has a few billion sitting in an account in India.

They can spend 100% of that money to build a new campus in India and hire a thousand Indian software engineers to design the next version of iOS.

Or they can get 65% of that money to use in the US, and pay for fewer engineers here (cuz they're more expensive BTW).

What choice would you make?, assuming you're the responsible CEO, required to increase your shareholder's value as best you can.

Our government should be encouraging corporations to bring their money home, to be spent here. Discouraging that = more overseas jobs
 
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- This is the legacy of the great Apple, who made computers usable for the average person instead of the professional geek? Overpriced luxury goods, closed ecosystems, anti-competitive behavior, and ruthless corporate greed? This company is not your friend, people. It is a very big fish in the sea of capitalism. The products make you feel warm and fuzzy because that's what gets you to buy the products, which is what makes money for the shareholders, which is what Apple is legally required to do. That's the system. It breeds corruption. Apple is not immune.

QFT

That's why I think Apple is the Microsoft of the current era. Heck, what Apple argued about Mobile Safari and Flash on the iPhone makes the Internet Explorer in Windows discussion pale...

I'd so love if Apple actually spent only 5 billions to derive a nice desktop processor from the Power7 chip. But they rather milk iPhone sheep.

Reality check: iPhone will never be to the mobile ecosystem what iPod was for the MP3 ecosystem. Get over it...
 
There's a simple concept from Econ 101:
Taxes discourage an activity

So it's obvious that the 35% tax discourages corporations from repatriating their earnings. Think about it: Say Apple has a few billion sitting in an account in India.

They can spend 100% of that money to build a new campus in India and hire a thousand Indian software engineers to design the next version of iOS.

Or they can get 65% of that money to use in the US, and pay for fewer engineers here (cuz they're more expensive BTW).

What choice would you make?, assuming you're the responsible CEO, required to increase your shareholder's value as best you can.

Our government should be encouraging corporations to bring their money home, to be spent here. Discouraging that = more overseas jobs

Which is exactly why the government has done this in the past. We should encourage corporations to repatriate earnings so that they can be used at the United States parent corporation to do R&D, expand their campus, and create jobs here. Besides, even at the 5% the government would generate significantly more revenue than it would with the earnings just sitting overseas; 35% of $0 is always going to be $0, 5% of a $20 billion repatriation is $1 billion more than the 35% rate would yield. Of course, we could actually fix the root of the problem and put in place corporate tax rates that are inline with the rest of the world, but that's dreaming. This really isn't surprising, the government tends to have a program like this every once in a while.

The lack of understand of anything tax related that permeates this entire thread really cements my decision to get a master's degree in the subject.
 
There's a simple concept from Econ 101:
Taxes discourage an activity

So it's obvious that the 35% tax discourages corporations from repatriating their earnings. Think about it: Say Apple has a few billion sitting in an account in India.

They can spend 100% of that money to build a new campus in India and hire a thousand Indian software engineers to design the next version of iOS.

Or they can get 65% of that money to use in the US, and pay for fewer engineers here (cuz they're more expensive BTW).

What choice would you make?, assuming you're the responsible CEO, required to increase your shareholder's value as best you can.

Our government should be encouraging corporations to bring their money home, to be spent here. Discouraging that = more overseas jobs

BS, that simply ignoring the current state of affairs.

No anyone actually believing apple is going to spend the vast mayority of the money in the USA still believes in santa clause.

Apple has enough earnings in the USA itself to be able to provide for any investment they want. They are just looking at a cheap tax cut.
 
these corporations want ALL the benefits of being based in the US, enjoying the stability, security, a judiciary system and access to 300 million consumers, but they don't want to PAY for the maintenance of such state? They are welcome to move to China or India then.

The reason the rate is 35% for corporate is to compensate for the loss of revenue caused by the tax cuts for individuals enacted since Reagan. If now they want to cut taxes for corporate, guess how the govt is going to make up for the difference? yes... higher taxes for individuals in the middle class. Not the rich!.

and no, poor Apple doesnt get "double taxed" there are treaties with many govts to deal with taxation overseas and in any case, neither Apple nor any other seasoned corporation ever pays the full 35%. there are so many loopholes, subsidies and giveaways in the tax code for the mightiest corporations that the 35% figure is a joke.
 
Which is exactly why the government has done this in the past. We should encourage corporations to repatriate earnings so that they can be used at the United States parent corporation to do R&D, expand their campus, and create jobs here. Besides, even at the 5% the government would generate significantly more revenue than it would with the earnings just sitting overseas; 35% of $0 is always going to be $0, 5% of a $20 billion repatriation is $1 billion more than the 35% rate would yield. Of course, we could actually fix the root of the problem and put in place corporate tax rates that are inline with the rest of the world, but that's dreaming. This really isn't surprising, the government tends to have a program like this every once in a while.

The lack of understand of anything tax related that permeates this entire thread really cements my decision to get a master's degree in the subject.

LOL. the global corporations don't pay 35%. The reason the rate is 35% is to compensate for the gospel of tax cuts for individuals implemented since Reagan.

The biggest corporations' operations are so global that they are not going to repatriate any more than what they actually need to fund their smaller and shrinking US operations. Why would Apple repatriate their billions of dollars here when they may be sitting in Dubai ALREADY at 0%. They will keep their money overseas to fund their massive international operations. The idea that if they lowered the rate to 5% they would bring it all is simply corporate propaganda to fool the public into supporting the defunding and dismantling the US as a first world nation.
 
You might want to check some sales figures on that one, champ.

You ought to check them yourself. And maybe, just for a second, you should keep in mind that Apple somehow has lost the 'innovation'-factor in the mobile industry.

Followed the news about the Mobile World Congress? No? I thought so.

<still on the edge deciding whether to get an LG Optimus 7 or wait for the Galaxy S2>
 
your shiny iphone was made by slaves

when one has no say in his conditions of work and his pay, he's a slave or in a factory in China no ?
Who wants to start a petition: "Apple 100% made in USA - less profit less slaves"
 
Apple should pay their tax as a company doing fine throughout recession and with massive profits, in light of budget cuts affecting the poorest in society being made.

Although why don't they just pay tax in each individual country?
 
Correct if I'm wrong, but Apple has ALREADY paid taxes on this money in the countries where it was earned... why should they get taxed at the full-rate on it twice?

Often they won't pay tax twice at anything like the full rate. If there's a reasonably up-to-date tax treaty in place between the US and the source income domicile there's typically a sharing of the tax revenue.
 
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