Tim Cook Calls Apple's Tax Avoidance Accusations 'Total Political Crap'

[MH01]

Are they breaking a law?

Completely irrelevant to the debate we were having . You abused people for comparisons between personal and corporate tax.

To answer your question , no , Apple is avoiding taxes within the rules. If you were rich and could afford expansive tax lawyers you could do the same. Hence why the average joe blow who has to pay thier personal tax and pay for all your countries infrastructure have issues.

 

[MH01]

Um, no. Tax evasion is defined as a purposeful illegal avoidance of a tax. The key word there being "illegal." You're saying that doing something legal is "effectively" doing something illegal. That makes about as much sense as saying legal possession of a narcotic for medical use is "effectively" the same as buying oxy on the street.

You treat the legality of this as if it's some side note to be brushed aside, when it's actually the only relevant issue.

The outcome of both is the same, you avoid taxes, tax evasion they can prosecute you, tax avoidance they have to change the rules as you found a loophole. avoidance is a cat and mouse game of tax reform where loopholes are closed via amendments and new ones found, and will continue while we have complicated tax rules .

Don't be mistaken, there is a very fine line at times between tax avoidance and tax evasion, court cases decide this.

 

[Popeye206]

It's also a problem created by the EU and Ireland. No matter how Cook wants to spin this, the simple fact is that Apple has a tax haven in Ireland where supposedly its research is performed. Yet, for some reason, features and updates are always introduced in the US first, and the countries of the EU have to wait.

I like Apple in most regards, but in this regard Tim Cook is really trying it on. Is Apple tax haven legal? Yes. Is it immoral? Yes.

Immoral? What's immoral about it? There's no morality about tax laws unless you're stealing. All they are doing is doing what 90% of the companies out there do and leverage existing laws to keep as much of the money they earn.

In the US, this is exactly what Trump (and other republicans) has been talking about and has proposed a lower corporate tax for US based companies to bring overseas revenues back to the US so they can invest that money here. The bottom line is Tim Cook is dead on with this issue and Apple is doing nothing different than most other companies.

There's nothing moral or immoral about this, but it is stupid of the US not to fix this issue so that it's advantageous for companies like Apple to bring the revenue home and spend it here. Imagine if they dropped the rate to 10% or 5% or even 0% for any money they would bring home to build manufacturing plants and make iPhones in the US? Imagine how may jobs would be generated and therefore income tax and use tax generated from all the employed US citizens?

 

[Popeye206]

I beg to differ on the third example. She had it coming. She only had herself to blame
If you'd have been there, if you'd have heard it. I betcha you would have done the same.

Very funny!

 

[numlock]

Immoral? What's immoral about it? There's no morality about tax laws unless you're stealing. All they are doing is doing what 90% of the companies out there do and leverage existing laws to keep as much of the money they earn.

In the US, this is exactly what Trump (and other republicans) has been talking about and has proposed a lower corporate tax for US based companies to bring overseas revenues back to the US so they can invest that money here. The bottom line is Tim Cook is dead on with this issue and Apple is doing nothing different than most other companies.

There's nothing moral or immoral about this, but it is stupid of the US not to fix this issue so that it's advantageous for companies like Apple to bring the revenue home and spend it here. Imagine if they dropped the rate to 10% or 5% or even 0% for any money they would bring home to build manufacturing plants and make iPhones in the US? Imagine how may jobs would be generated and therefore income tax and use tax generated from all the employed US citizens?

it seems you concept of moral is for some reason connected with what other people and companies do. its not a complicated concept that if you or your patrons make use of public services/utility that you pay your share. going to these lengths (obviously exposing lack of foresight or possible negligence in the law) to avoid paying your share is immoral in my mind.

so lower the tax rate for profit, repatriated profit and all will be well? if the tax burden shifts entirely to the employees (thats how i get your post) their cost of living goes up quite a lot and there will always be some country/people willing to work for less.

this race to the bottom thinking only suits those with extreme wealth and pandering to them is a lost cause.

 

[Thunderhawks]

'It can't be wrong if the laws allow it"? Huh? Whaaa?

"All companies do this" so it's ok. Huh? Whaaa?

WRONG is in the eyes of however somebody wants to interpret it.
Morally doesn't apply in business.

All other companies just means that using Apple as an example is looking for a whipping boy.

This wouldn't be news if it was Chrysler/Ford (put in any large company you like)
Why complain if it is legal? Fix the laws (Will never happen)

The US government doesn't have one thing to do with Apple's income in other countries.

 

[1458279]

Another issue here is that other nations don't always play fair. When Mexico gets billions from the US for economic development, then gives #100 Million to Kia to build a factory in Mexico, it creates an uneven playing field.
When other nations have tax laws that are more favorable to the business, the business has no choice but to survive.

The Gap offered above min wage pay, then close many of it's stores. Amazon hired 15,000 robots to operate their logistics. Amazon has a larger market cap than Walmart with 90% fewer employees.

This is a battle for survival, businesses broke ALL records for mergers in 2015. They are trying to leave the US (tax inversion). New businesses are NOT starting in the US because they see the future of the world.

A new version of industrial robots will be more versatile and have universal programming much like smart phones. Look at the rapid advancement of apps just since smart phones started, this is what will happen with industrial robots.

The world is in at least 2 bubbles: a debt bubble that enslaves it's people and destroys it's future, and a tech/stock market bubble that has VERY narrow support.
20% of ALL the gains of the S&P500 over the last 5 years came from ONE company ... (Apple)!

Businesses see the bubble, they are in a "flight to safety" by merging to become "too big to fail" and are looking for any way they can stock up on cash before the crash.

Meanwhile, government are looking to get every dollar they can, any way they can. The people in the city of Chicago owe more per capita than they owe for the NATIONAL DEBT !!!

Cities and states are on the edge of failure, they owe HUGE for pensions, their costs are thru the roof and their debt is HUGE.

At this 7 year point in the US recovery, we are worse off than the 7 year point of the Great Depression. Jobs are low pay and have limited futures.

Just in case that wasn't enough bad news, EU is under invasion by ISIS and will likely be the starting point of the next major war. Sweden is the rape capital of the world, there is no way to vet the invasion and it's too late to change this.

EU will fail under it's socialist program because they can't create nearly enough jobs, and have to deal with past debt.

The producers have fled in a flight to safety, get used to recession, a long, long recession with peaks of slow growth.

 

[5105973]

Yes... lets see... pay 40% more... or find another route to avoid paying that which in turns creates more jobs and products. Any business owner or half smart person would do the same. I don't know why liberals think business owners are bad people and they all hide their money under their beds. WRONG. Business owners invest their money to create more money! which stimulates the economy and creates jobs! If you tax them, they can't do that!

No one says "OH LOOK A 100 DOLLAR BILL! I'm gonna sit on it and hide it rather than growing that 100 into 100,000!"

I'm not a fiscal liberal. But corporations in the U.S. enjoy privileges extended to persons under the law, plus special benefits and powers owing to their sheer size, that enable them to hide money in ways small business owners can not do for their own companies and that individuals can not do for themselves.

While Apple and other corporations are finding creative ways to avoid taxes, this tax burden gets shifted onto the middle class and small business owners. It's actually the small business owners who offer the jobs in their communities and have the community ties that help sustain local economies. Corporations will shut down factories and relocate at the drop of a hat.

Corporations enjoy the same benefits we the individual people enjoy from taxes: strong infrastructure, national defense, local and federal law enforcement. Why should it fall to my family, which for some reason Obama has decided is "rich" and therefore taxes us at close to a 50% tax rate, to pay for all of this and end up living just one bout or serious illness away from financial ruin?

For a "rich" person, I can't tell that I'm rich. I drive a 24 year old car and few things we own aren't hand-me-downs. My iPhone and Apple Watch are my big splurges. I have a closet full of sweaters and t-shirts and jeans that are years old. My shoes are from Target, not a designer one in the bunch. I moved out to the country so I could be on a well and not have to pay ever increasing water bills and so I could start growing some of my own food because the grocery bills are killing us. As one of Obama's rich families we are hardly living high on the hog. We live at about the level you'd hope a family headed by two college educated people entering their 50's would live in a first world country. No more, no less.

Sorry if I don't cheer Apple on and that I wish they and other corporations would step up and pay a fair share. The only thing I would agree on is that we need complete tax reform. Nobody and no company should have to pay close to 50% of their hard earned money to the state. I think the current tax codes practically force people to hide their money instead of putting it into the economy.

 

[Azzin]

How many power supplies for the MacBook have you gone through because the cable strain relief is inadequate? (I am on number three for my kid's MacBook)

There is a common denominator here that you are perhaps not thinking of.

 

[Nevaborn]

The stupid thing is, this is not tax avoidance. Apple has finances in overseas markets like every global company. If they brought the income back to the USA and did not pay the tax then that is avoidance. By having revenue in another country that money should be taxable to the country it is in.

Say you own a second home abroad. Any bills for that property are paid to the govt where that property is, not the one where you reside now.

 

[Azzin]

They're avoiding paying taxes that they don't have to pay. Keep that in mind.

Actually, they're simply not paying taxes that they don't legally have to, or just paying the ones that they do have to (take your pick).

I think this 'avoiding' implies some skullduggery and Apple simply don't have to do that.

They're simply following the laws set out for them to follow.

 

[thermodynamic]

Immoral?

Screwing your brother's wife is immoral.
Stealing money from your child's piggybank is immoral.
Strangling your sister is immoral.

This is far from immoral.

Slavery is immoral. Child labor is immoral. Last time the media checked, Apple (and others, we know) freely use such labor to profiteer from. So even if you're right that playing big games with tax forms isn't immoral (despite your lack of describing why it's "far from immoral"), how they got their money could still easily be argued that they did so immorally. Or is human rights no longer a faddish issue?

Your turn.

 

[thermodynamic]

The stupid thing is, this is not tax avoidance. Apple has finances in overseas markets like every global company. If they brought the income back to the USA and did not pay the tax then that is avoidance. By having revenue in another country that money should be taxable to the country it is in.

Say you own a second home abroad. Any bills for that property are paid to the govt where that property is, not the one where you reside now.

Say that one earns money in the home one owns abroad... wait, that is not what's going on. Apple leases factories in these other countries -- not owns them (in which case, wouldn't the child and slave labor and the brutal conditions and all that be on Cook's hands even more since he chooses not just to use them but would then own them? So, yes, my hyperbolic parallel scenario is just as ludicrous as the one you attempted to make.)

 

[RedOrchestra]

"Apple is said to utilize multiple foreign subsidiaries in Ireland to move around overseas money, which Cook says accounts for two-thirds of Apple's revenue..."

Unless all the money is revenue from sales in Ireland IT IS flat out tax avoidance. And to say differently or say well other companies do it is just plain fan-boyish talk.

 

[rdlink]

There are in the UK, and there is now a moral dimension to the legality of tax schemes.

We have aggressive tax avoidance, which is deemed illegal. That means that if a person or business takes advantage of a legal means to avoid tax that is against the spirit of the law, he or it may be prosecuted. Ideally, those legal loopholes wouldn't exist, but this is a compromise.

Just think how many times in a day we, on a personal level, make decisions that can be legal but morally wrong. It is often up to us to police ourselves. But when corporations lose their sense of moral compass, it is necessary for the government to step in, as they are effectively being defrauded to the tune of billions of dollars by big business.

Sheza's comment above was excellent. It is easy to get frustrated with the Machiavellian tax laws and demand that loopholes are closed, but I suspect that if it were that easy, it might have already happened. The structure of the EU is to blame, I feel, in treating the whole of the EU as one block, yet preserving national tax laws. This is a fundamental flaw; you cannot have a single currency without a federal state. Hence, the abuses we see by Apple and other corps. I don't believe England will ever want to be part of a federal state, which is why we want to leave the EU, as that is the only successful outcome of the EU. As it is made up of so many different countries, I don't think they will ever agree to a federal union, which dooms the EU to failure.

Cook's hypocrisy is especially risible, as he claims Apple want to leave the world a 'better place than they found it'. We all know he's talking about his petty and pointless social activism, yet his hypocrisy is double: he freely does business with China and Russia because he 'follows the money' as he likes to say in the quarterly earnings, despite their support for social mores wholly opposed to Cook's. And he gets on his high moral stance about accessibility—'It's not about the bloody ROI'—when it suits him, but not when it suits the welfare of countries.

In other words, blind people are worth paying more tax for, but government isn't.

All of this could have been avoided if Apple chose to pay tax for the countries in which their products were purchased, which is where their huge profits were really made, and if Cook had not made Apple a vessel for his personal political views. We can see how Jobs was wise to keep focused on Apple and almost never be distracted by political matters. He would have still had the problems of tax, but I feel sure he would have dealt with this matter in a better way.

The first two paragraphs of your post made the rest of it extraneous. Once again, there is no such thing as immoral legal tax strategy. Regardless of what crazy, screwed up laws the UK has in place. One of the primary jobs of a government is to create rules that are beneficial to your citizenry, be able to enunciate those rules clearly and apply them consistently.

Taxes are a government taking. And tax laws are a contract between the government and its citizens, including corporations. Blaming a corporation (or an individual citizen) for the mess that the government has made of the tax laws in order to continue to keep coming to the trough of its citizenry to fund mis-managed government programs (and yes, this includes military spending) is completely insane. This is why revolutions happen, and it's also why people hate the U.S. Internal Revenue Service.

The hodgepodge mess of rules in place when it comes to paying taxes were not a problem for any government entity (in fact I would say that they relied on their complexity to oppress the common taxpayer) until someone was successful enough at using those complex laws against them to the tune of hundreds of billions of dollars. I, for one an cheering for Apple, or any other US citizen who uses the arcane and ridiculous tax laws of the US to their advantage.

And as far as Jobs is concerned, he had the same attitude that Cook does, and he verbalized it more than once. Including a direct conversation with the President of the United States.

 

[AlexisV]

Nothing will change. Governments simply don't want to tax big business. Get the investment and jobs in your country and the workers will pay you the tax.

The UK's 'Google tax' legislation is a piecemeal bit of PR for the Tory party.

 

[DudeDad]

Bringing those overseas dollars will make Safari much snappier.....

 

[Rogifan]

It's perfectly legal for Tim Cook to fire an employee of his for being gay [Edit: in any of 27 US states]. Does that mean he has the right to do so, or the obligation to do so if that would increase Apple's profits?

The job of a lawyer is to decide if something is legal. The job of a citizen in a democratic society is to decide if something is moral and just.

That's not the job of a CEO of a company. Oh and by the way Tim Cook said he's giving away all his personal fortune (after he pays for his nephew's college education). How much of your fortune are you giving away?

Took 10 seconds. Seriously there are so many articles explaining it , choose any.

http://www.forbes.com/sites/beltway...bout-apples-tax-avoidance-how-ordinary-it-is/

Again, explain what Apple is doing that isn't LEGAL. If the laws are bad blame politicians, not Tim Cook. Do you pay more tax than you legally have to?

 

[Juicy Box]

it dosent work like that. there is no way in competing with a delaware or an ireland or even replicating that on a larger scale especially if you want taxes to provide for something.

It does work like that. It works like that right now. So many corporations leaving the US to avoid taxes.

the problem becomes even bigger when you realise that wealth is being hoarded and dosent move through the economy.

Totally separate issue, and there are tax laws on the books for this issue, although it is easy to avoid. Like never bring the money back to the US, or just say the hoard of cash is for the purchase of assets.

AET could be reformed to fix this issue. Also, making it more appealing to bring the money home by lowering the corporate tax rate could help this issue.

 

[MacBH928]

So Apple is an evil corporation because they abide by the law?

This is the most retarded argument I have ever seen. T

 

[CalWizrd]

Slavery is immoral. Child labor is immoral. Last time the media checked, Apple (and others, we know) freely use such labor to profiteer from. So even if you're right that playing big games with tax forms isn't immoral (despite your lack of describing why it's "far from immoral"), how they got their money could still easily be argued that they did so immorally. Or is human rights no longer a faddish issue?

Your turn.

I would imagine that if enough people felt as you do, that Apple, as well as many other corporations involved in manufacturing or selling manufactured goods, would find themselves with no customer base, followed by zero sales, followed by becoming former companies.

I guess that's not the case.

 

[ucfgrad93]

Congress has no spine to undue the damage, until the GOP is out of power.

The Democrats were part of the process that created the tax laws here and have no more desire to fix it than the Republicans.

 

[macfacts]

Tim Cook: "... . This is a tax code that was made for the industrial age, not the digital age. It's backwards. It's awful for America. It should have been fixed many years ago. It's past time to get it done."

He is right the tax code is broken. In the industrial age, companies didn't use patents as weapons. In the modern age, companies like Apple (they figured this out and their tax accountant even named the scheme, "Double Irish with a Dutch Sandwich") do their R&D in USA, patent it, sell those patents for SUPER CHEAP to their shell companies in Ireland (therfore the USA company pays little tax on it), then the shell company in Ireland gets to charge market value for those patents. Apple then does that a few more times in some low tax countries and thats how Apple doesn't pay their "fair" share of taxes in USA, even tho the tech was all invented in USA.

Tim Cook seems to be saying "Don't hate the player, hate the game". That's not how public opinion works, we are allowed to hate the player that takes advantage of loop holes. Yes we need to change the rules (tax laws) but that doesn't mean we can't point out and criticize Apple's actions even if they are technically legal, just like slavery was technically legal before. Laws change.

 

[Chupa Chupa]

The cliche "pot calling the kettle black" comes to mind. Regardless of the situation its absurd for Cook to be whining about "political crap," when he himself wades so deeply in politics, even beating down an Apple shareholder who he did not share the same political view with on the topic being discussed at that meeting. If Cook feels it necessary to meld his politics with his Apple leadership fine, but it's a double edge sword. He doesn't seem to like it when the sharp edge faces him. But he is certainly no victim.

 

[tdream]

Aww Apple always wants to play the good guy. Bad Mr. Government is trying to take my lemonade stand money. Poor Apple...