How Apple Minimizes its Corporate Tax Burden

[shamurai]

Actually, worldwide the richer have been getting richer. In Western countries like the US and the UK, they have been doing this in part through tax avoidance and outright tax evasion.

As for 'the clever getting richer', I have to ask what was so clever about the lemming-like bankers who drove the global economy into a nosedive? In the UK they seemed to have retired early, using their amassed wealth to sit on their fat, parasitic arses while living a comfortable life doing absolutely nothing of value to anybody.



Fair enough. I was sloppy in my language. They threaten to leave (for instance).

First off, it's not tax avoidance or evasion if what they are doing is legal.
Second, its sounds to me like you're describing welfare recipients. The only difference being that they never, ever, contribute to society, whilst the rich worked to get their fortune and have the right to retire and enjoy the fruits of their labor.

 

[cadillac1234]

The funniest part about this thread is how people's position is based on their affinity for Apple.

If the article was about Exxon, Citibank or a big insurance company, would people start singing a different tune?

I'm a big Apple guy, own stock in the company and think that Tim Cook is a supply chain magician.

That being said, Apple (and every corporation) should pay more in taxes to the government. As I stated in another thread, they enjoy protections under US law that no other country can give them and utilize a large portion of US resources.

95% of the citizens will never utilize the US patent office. Should we disband it because it's not serving everyone? Apple consumes much more of those patent resources than they pay for. At the same time, I as a citizen will consume more from the healthcare system than Apple will as a corporation.

Should Apple pay extra billions to prop up the US patent system by themselves? A lot of people are asking citizens to do the same thing with schools and healthcare

 

[MBAophile]

While some of these politically motivated and otherwise off-the-subject comments are interesting, I would just like to ad my 2 cents worth regarding the main point - Apples low corporate tax payments. The N.Y. Times focuses on Apple, most likely, because of it's enormous profits of late. Being an Apple stockholder, I benefit from these profits. However, this is common practice among most all high-tech corporations and we can't entirely blame them for doing what most people do anyway - use any and all means (legal, usually) to lower one's tax rate. The fault clearly lies with Congress and the myriad of tax breaks afforded to these corporations - and here it must be pointed out that it is typically Republicans and very business-friendly Democrats who have supported these types of tax breaks over the years. But these tax breaks have real consequences because only 2 things can happen as a result - either other domestic programs are cut to the bone or even eliminated or the deficit climbs even more. Congress will, of course, absolutely refuse to create other, new taxes to make up for all of these tax breaks afforded to the corporations, therefore, in the end the middle class and the poor suffer. Wake up America, vote for these types of politicians at your own peril.

 

[dr Dunkel]

When things like this surface, changes are made...

 

[VulchR]

IYHO, Apple's activities are immoral. But making the statement doesn't make it true.

Hence my use of the word 'Personally'. Besides, I am not so humble.

 

[ken94538]

rich get richer...

Richer and evil.

 

[shamurai]

Stop putting all the burdens on the citizens and force corporations to a fairer share.

Assuming that the corporations don't pass the cost of taxes to the consumer?
IF you believe that, then your are truly ignorant.

 

[RedCroissant]

Venezuela (Hugo Chavez) is controlled by the CIA. Chavez is an actor, not a real dictator at all. Mods locked my thread for saying so without references, so here is one source that agrees and was written well before my posting: http://devilsexcrement.com/2008/04/15/is-chavez-a-cia-agent-or/

So instead of providing references that prove you are correct, you provide a link to a blog that also does not provide references, but simply agrees with your opinion?

 

[jlasoon]

I knew about the housing bubble and crash in 2001, due to a nice article on http://mises.org Clinton era regulations combined with Bush era manipulated interest rates ensured it would happen. I made a killing on the way up and on the way down. It was amazing.

Glad to hear I'm not the only one who figured it out . The amazing part is, it's not over. There's more coming. And there's more to be made.

Greece is a perfect example. The US is in a worse state than greece (if accurate accounting was done) and the people are screaming just like the greeks are.

Only difference is, since the US exports most of its inflation and manipulates commodity prices it can delay the accounting longer than greece could.... but not forever.

Exactly, but you forgot the printing press, we can print money, Greece can't. Since the dollar is the reserve currency, we are in essence exporting inflation to the world. Like u said, not for long though, eventually China will figure it out. France has already told us that they don't believe our numbers. It's about to get real ugly and most are completely clueless.

 

[cadillac1234]

Assuming that the corporations don't pass the cost of taxes to the consumer?
IF you believe that, then your are truly ignorant.

Supply side economics says that it will force the corporation to become more efficient, which will lead to an increase in profit and a decrease in cost and thus
benefit both the corporation and the consumer.

 

[slrandall]

You hate it because you do not agree with it, but it's a fact you can't ignore.

How does the fact that taxation exists justify the existence of taxation?

What she's saying is that because we have a system in place, we must all obey it. But a thing cannot be its own justification; that's logically wrong.

I understand the arguments for taxation; the benefits it can provide sometimes help people. But morally, it's still wrong. If I steal your wallet and drop it off at an orphanage, it's still theft. This is a black-and-white issue; intentions don't matter.

 

[0098386]

If Apple paid more tax wouldn't that improve the US, as a whole?

 

[thekev]

This is the problem with the media. This person just "learned" that Apple pays 9% tax. Of course, there is no actual knowledge associated with that number, but that number is going to stick in his head and color his perception. Even though we have no basis for understanding the number, or even if it is accurate.

Also, 89% of all statistics are simply made up on the spot. And the gullible always believe them.

This doesn't come down to any single problem. I'm wondering if you actually think it's clever that you made up a fictitious statistic for the purpose of irony in your statement. While I don't trust things without sources cited, publications do have people who are responsible for fact checking such figures.

Assuming that the corporations don't pass the cost of taxes to the consumer?
IF you believe that, then your are truly ignorant.

This is an argument that comes up consistently, yet if you examine it, it's simply not true outside of low margin items. Prices are set to maximize profits. This means if a corporation could increase their profits by raising the price, they will do so assuming a lack of dissuasion from other unrelated factors such as pushing market adoption rates. Cost changes only affect what they need to charge for a product to maintain consistent margins. They do not dictate what a company will charge for a product.

 

[guzhogi]

I believe the US, and the world for that matter, would be in much better shape if people took better responsibility for themselves and had better respect for everyone and everything. A lot of people whine about how there are so many government regulations. After the oil spill in the gulf, can you be surprised there are regulations? There's a bunch of other catastrophes that could be listed, but I don't think I have to.

Sure, government isn't perfect, but sometimes you bring it on yourself. If you won't do what's responsible, you probably deserve the consequences.

 

[DisMyMac]

So instead of providing references that prove you are correct, you provide a link to a blog that also does not provide references, but simply agrees with your opinion?

They didn't ask for proof (which would probably be illegal to provide), only for a source. Honestly I've never seen people so eager to place the idea next to space aliens and 9/11 conspiracies... so determined to make sure the idea isn't discussed...

I wonder why.

 

[JAT]

Also, taxes are on total revenue, not just profit.

Completely wrong.

First off, it's not tax avoidance or evasion if what they are doing is legal.

If you want to use actual terms, avoidance is legal, evasion is illegal.

 

[sikkinixx]

If Apple paid more tax wouldn't that improve the US, as a whole?

Stockholders as a whole don't get a crap about the US. They just want more money, and if Apple can save tax money, it makes shareholders happy.

 

[btbeme]

Sounds like these other countries have a better grasp on how to treat successful businesses. If the United States chose to bring their corporate tax rate into line with the rest of the world there would be no need to offshore profits like this. Instead, we choose to punish successful companies with the highest tax rates in the world. And then we poop on police cars while protesting the fact that the top 500 corporations in America employ close to 40% of the population. Strange way to show appreciation.

It has been noted here a few times and bears repeating - corporations do not pay taxes. They simply pass the cost of business along to the consumers.

 

[jlasoon]

You hate it because you do not agree with it, but it's a fact you can't ignore.

It's a stupid comment, made by a clueless professor at Harvard. That's a fact you can't ignore.

 

[Ironduke]

I worked in the USA once, I paid Taxes yet was not allowed to vote!

Then it dawned on me, i was suffering from

TAXATION WITHOUT REPRESENTATION

oh the irony

 

[JAT]

This doesn't come down to any single problem. I'm wondering if you actually think it's clever that you made up a fictitious statistic for the purpose of irony in your statement. While I don't trust things without sources cited, publications do have people who are responsible for fact checking such figures.

Please show me anyone scrupulously checking out the facts, with expert ability to analyze the numbers, and holding the newspaper responsible. I'm assuming you are refering to my earlier post, as well, despite not quoting it.

And I have never made up any statistic for the purposes of publication. Can't you tell? I'm part of the 11%.

 

[VulchR]

First off, it's not tax avoidance or evasion if what they are doing is legal.

'Tax avoidance' is the legal avoidance of paying tax, 'tax evasion' is the illegal avoidance of paying taxes. Again, my argument is that legal avoidance is immoral, since it relies on armies of accountants and lawyers figuring out how to scam legally. Since the poor (and indeed much of the middle class) cannot afford this kind of legal help, they wind up with a disproportionate burden.

Second, its sounds to me like you're describing welfare recipients. The only difference being that they never, ever, contribute to society, whilst the rich worked to get their fortune and have the right to retire and enjoy the fruits of their labor.

Indeed, people on welfare cost us money!. Shock! Horror! Indeed, I have no doubt we will soon see political advertisements that tell us just much those people cost. Just like they did in the Third Reich.

 

[clibinarius]

In addition to this, rember that all corporate taxes are payed by the customer.

This logic is false. It violates supply and demand. Goods are priced to maximize profits. If you can't sell more, you eat the loss. Its only passed to the consumer when you can afford to do so. If you can't afford to do so and you can't eat the loss-and this is important-the production shuts down, which is the worst world for everyone.

I wish this stupid myth would stop being said. Businesses can't pass everything to consumers. You're thinking in times of economic expansion, not depression.

 

[guzhogi]

First off, it's not tax avoidance or evasion if what they are doing is legal.
Second, its sounds to me like you're describing welfare recipients. The only difference being that they never, ever, contribute to society, whilst the rich worked to get their fortune and have the right to retire and enjoy the fruits of their labor.

I hope you don't mean everyone who's rich got rich because of hard work. What about all those people who won $300 million lotteries?

Even if I win that kind of money in the lottery or whatever, I think I'd still like to work. Sure, I'd splurge a bit, travel the world, buy a nice home, etc. But I'm the kind of guy who needs to do something productive to feel good, not just sip mai thais on a beach somewhere.

 

[8281]

It's the fault of our corrupt Congress who write a corrupt tax code.

Well, on the other side of that coin are interest groups. There are, I believe, six lobbyists per member of Congress. Revising the tax code is so problematic because everyone wants to pay less, while receiving the same benefits (this is one paradox of a democracy; few people will voluntarily pay more). Personally, I think that's part of the reason we hear very few concrete discussions about how we are going to pay Medicare, SS, and Medicaid for the millions of retiring boomers. No one wants to hear that someone has to start paying more, but significantly cutting benefits is politically toxic (Medicare will soon become the single largest federal expenditure). Unfortunately this dearth of information and context results in different interest groups picking their boogeymen, whether that's a corporation or a teachers union.

But I think we are also partially to blame. Sometimes we are reluctant to hear the truth, so we enthusiastically support candidates who promise fiscally unwise policies.