Tim Cook Defends Apple's Tax Record Ahead of Senate Committee Appearance [Updated]

[stylinexpat]

Had Apple invested some of their cash overseas with the Rothschilds I am sure that they would have turned a blind eye but seeing them sitting on so much cash without willing to share it they started to look for trouble and make trouble for them. Notice how they do not bother Google much in the US..

 

[phillipduran]

Pay the 13 Billion and bring that money back to the United States. Become an example for other companies.

Taxes suck. Period.

This money would be here already if it wasn't for high tax rates.

We collect so much money in taxes we give it away to the rest of the world.

Government employees make way to much money. Look at the salaries that have been exposed in the last year of all the California gvt officials.

They are being an example. The example is, lets not put up with government being a roadblock to business and success through over taxation.

Government, taxes, regulation, licenses. All that is pushing this nation down. Reduce those things and we prosper.

----------

Tax loopholes should be closed.

Profits gained within that country should be taxed in that country.

Any resultant cash flow should be moved around freely.

Why is this so hard to conceptualize for politicians?

Shouldn't we have signs on our shores that say "Please bring your money here and spend it."

How could that be a bad thing?

Instead, let's tax it at 35% to discourage it from coming home.

 

[chrmjenkins]

the government can't make up a tax code with 100,000 loopholes and dodges and then be heard to complain that taxpayers are taking advantage of those provisions which the government itself drafted and passed. Unless you think Google (and others) are not only cleverly using the law as written but actually breaking it - in which case (if you're right, which I very much doubt you are) they should be punished to the full extent of the law.

I believe it's a bit naive to think that the US tax code was written to include those loopholes. Many are methods that have grown since the tax code was written and it's become too difficult and partisan-locked to change any of it.

Businesses don't see it that way. It is a standard requirement, so it is built into advertised prices and they have to remit the tax out of receipts. The USA sales tax works differently.

And US businesses don't have to subtract state sales tax out of theirs?

The consumer knows the exact value of the tax and that it's being applied directly to the product they are purchasing. I don't care what a business says. That's a consumer tax. It's taxing the consumption of goods, not the production or even the profit of the good.

 

[rdowns]

Businesses don't see it that way. It is a standard requirement, so it is built into advertised prices and they have to remit the tax out of receipts. The USA sales tax works differently.

That's nonsense. Both are taxes imposed at the point of purchase. The only difference to the business is that you advertise prices in Europe including VAT while sales tax is not included in the advertised price in the US. Businesses have to treat both the same in that they remit what they collect to the government.

 

[JAT]

And US businesses don't have to subtract state sales tax out of theirs?

The consumer knows the exact value of the tax and that it's being applied directly to the product they are purchasing. I don't care what a business says. That's a consumer tax. It's taxing the consumption of goods, not the production or even the profit of the good.

That's nonsense. Both are taxes imposed at the point of purchase. The only difference to the business is that you advertise prices in Europe including VAT while sales tax is not included in the advertised price in the US. Businesses have to treat both the same in that they remit what they collect to the government.

You guys sure know a lot about how people think. I hope you are using it in your careers, no doubt you'll go far.

 

[rdowns]

You guys sure know a lot about how people think. I hope you are using it in your careers, no doubt you'll go far.

I'll take that to mean you know you were wrong.

 

[stylinexpat]

It is not just Apple but others too. Check out Starbucks.

http://articles.chicagotribune.com/...ucks-proposal-tax-rate-territorial-tax-system

 

[Zombie Acorn]

Im still trying to figure out how companies are allowed to keep money made offshore without paying taxes on it. If I go and make $300k without stepping foot in the US they are going to want my tax money whether the cash is offshores or not?

If corporations are people, it seems strange that we have two very different sets of rules.

 

[chrmjenkins]

You guys sure know a lot about how people think. I hope you are using it in your careers, no doubt you'll go far.

You'd think I was a consumer myself.

 

[Aragornii]

Im still trying to figure out how companies are allowed to keep money made offshore without paying taxes on it. If I go and make $300k without stepping foot in the US they are going to want my tax money whether the cash is offshores or not?

If corporations are people, it seems strange that we have two very different sets of rules.

They do pay taxes on it. They pay taxes to whatever country they are conducting business in. If they decide they want to move that money to Apple HQ in the US they will further pay US taxes on that money.

If you started a business oversees you'd pay local taxes wherever you were. If you decided to take home that income and spend it you'd further have to pay tax to the US to bring that money home. It's no different. The US has a ridiculously high corporate tax rate compared to other countries, so like Apple you would have a huge disincentive to do anything other than leave the money where it is.

Corporations are groups of people acting together as a single entity, and under the law that group is a "person" that has to pay taxes, can be gulity of a crime, etc. That's what's meant by saying corporations are people. And just like people, they all pay different tax rates.

 

[JAT]

I'll take that to mean you know you were wrong.

Let's see your research. Pick 100 businesses in Europe, ask how they treat various taxes in their conversations and accounting.

Let me know.

 

[chrmjenkins]

Let's see your research. Pick 100 businesses in Europe, ask how they treat various taxes in their conversations and accounting.

Let me know.

You don't get it. We've already pointed out that it's no different than the US (businesses collect taxes, must subtract it from their books), which is the first place you're wrong.

The second place you're wrong is assuming we care what businesses call it. Consumers see it as a consumer tax. Businesses have to account for it because they are adjusting for consumer perception of the prices with tax. The only reason it affects their price is because the added tax affects whether the consumer will buy it or not.

The way you're talking, my local grocery store should consider food stamps a tax rebate because it makes consumers more likely to purchase goods at their stores.

 

[thehustleman]

Would love to see something that moves all manufacturing back to US. Can't they write tax laws that make it a win win scenario? Not even gonna try to defend tax law because I only know how to use turbo tax. Haha

There was a bill that would have ended a lot of outsourcing and brought more jobs here but the Republicans blocked it.

It would have taxed companies that outsourced while giving breaks to those that hire American

 

[rdowns]

There was a bill that would have ended a lot of outsourcing and brought more jobs here but the Republicans blocked it.

It would have taxed companies that outsourced while giving breaks to those that hire American

Don't worry, it's not like the Republicans aren't working. Why just yesterday, they voted to repeal Obamacare for the 37th time.

 

[RedCroissant]

I'm quoting myself because it's obvious nobody actually read my post or several other posts in here and/or even try to understand the problem. Read that step to step and let me know if this is the "correct" thing for america to let their corporations do

Hey FD,

I think most people did read it but didn't respond because they recognize the problem with your post: the fact that you question these tactics on a moral level when that is inappropriate. It's related to a strange sense of entitlement that(if that is in fact your feeling) you have no right to expect. Tax laws are not moral arguments or positions; they are legal recognitions of implied and expected responsibility by an individual or corporation.

There is nothing here that is illegal, since these loopholes and procedures are and have been observed by both corporations and the respective governments that have and continue to allow these practices to continue

 

[FrozenDarkness]

Hey FD,

I think most people did read it but didn't respond because they recognize the problem with your post: the fact that you question these tactics on a moral level when that is inappropriate. It's related to a strange sense of entitlement that(if that is in fact your feeling) you have no right to expect. Tax laws are not moral arguments or positions; they are legal recognitions of implied and expected responsibility by an individual or corporation.

There is nothing here that is illegal, since these loopholes and procedures are and have been observed by both corporations and the respective governments that have and continue to allow these practices to continue

Hey RC:

This is a message board. We're not tax professionals, we're also not government officials. What we're talking about ARE moral implications for what's going on. I don't mind if people defend apple on legal grounds, but it bothers me because it's clearly obvious people don't understand the tax tactics used and defends apple anyway.

The tax "loophole" was used by LBJ for the Vietnam War. While I think that the word of law is fair and games, the spirit of the law should be taken into account as well. This isn't a fair tax law and I don't think it's logical to separate the moral from the actual in this argument. nobody else in this topic is, i don't know why you think they are.

 

[RedCroissant]

Hey RC:

This is a message board. We're not tax professionals, we're also not government officials. What we're talking about ARE moral implications for what's going on. I don't mind if people defend apple on legal grounds, but it bothers me because it's clearly obvious people don't understand the tax tactics used and defends apple anyway.

The tax "loophole" was used by LBJ for the Vietnam War. While I think that the word of law is fair and games, the spirit of the law should be taken into account as well. This isn't a fair tax law and I don't think it's logical to separate the moral from the actual in this argument. nobody else in this topic is, i don't know why you think they are.

FD,

I know this is a message board and not generally populated by tax professionals, but that lack of tax knowledge should not lead to the equivalence of secular legal statutes with assumed moral obligations. The lack of professional knowledge in the tax field should also not automatically allow or justify claims to be made simply due to ignorance of the subject matter.

I can easily defend Apple on legal grounds and I also understand the tax tactics being used to legally decrease their tax liability. This is a tactic that is recognized and utilized by not just US corporations, but foreign corporations as well and is still allowed by foreign governments.

The reason I think it is logical to separate the moral from the actual is because with the claim that somethign should be morally recognized is an implied claim that something is universally recognized as moral/immoral and everyone should then be obligated to live by presumed standars according to a subjective understanding of morality and its applications in day-to-day life. The reason I think other people are separating the moral from the actual is because they are obviously defending Apple's business practices that are in accordance with domestic and international laws.

Another reaon why it is easier to separate the "moral" from the actual is due to domestic tax policy that is rarely addressed when arguing for greater tax liability for individuals and organizations with high income levels that take advantage of US tax laws and policies to also decrease their own tax liabilities. As an example, how many educational, charity, and religious institutions do you know of that refuse to claim property tax exemptions every year? This is an important example because public school funding is primarily funded by property taxes. Therefore, if a person claims that a good education is moral, the that same person should challenge the morality of a legal statute that allows for these organizations to decrease the amount of available funds for public education. Although I am opposed to increasing property tax exemptions that result in decreased funding for education, I recognize and can easily defend those organizations' right to claim those exemptions in accordance with the law.

 

[Zombie Acorn]

They do pay taxes on it. They pay taxes to whatever country they are conducting business in. If they decide they want to move that money to Apple HQ in the US they will further pay US taxes on that money.

If you started a business oversees you'd pay local taxes wherever you were. If you decided to take home that income and spend it you'd further have to pay tax to the US to bring that money home. It's no different. The US has a ridiculously high corporate tax rate compared to other countries, so like Apple you would have a huge disincentive to do anything other than leave the money where it is.

Corporations are groups of people acting together as a single entity, and under the law that group is a "person" that has to pay taxes, can be gulity of a crime, etc. That's what's meant by saying corporations are people. And just like people, they all pay different tax rates.

Um no. When I make $300k from a country with a low tax rate and am a US Citizen I am expected to pay US taxes on my worldly income. Usually there is an agreement for taxes less what was already paid.

 

[JAT]

You don't get it. We've already pointed out that it's no different than the US (businesses collect taxes, must subtract it from their books), which is the first place you're wrong.

The second place you're wrong is assuming we care what businesses call it. Consumers see it as a consumer tax. Businesses have to account for it because they are adjusting for consumer perception of the prices with tax. The only reason it affects their price is because the added tax affects whether the consumer will buy it or not.

The way you're talking, my local grocery store should consider food stamps a tax rebate because it makes consumers more likely to purchase goods at their stores.

You guys are obviously talking about something else. I was talking about a major company CEO speaking to a Senate committee on USA taxation. His attitude (and interpretation) and theirs will be the point. Hint: It's right in the story title.

If you want to have a technical discussion about the nature of accounting and taxation laws, perhaps even GAAP, say that first. Don't jump into a different discussion and say it doesn't apply to your technical point, which isn't even being discussed. Just like I keep saying to people at work, "there's a lot of SHOULD being thrown around, and I have to deal with what actually happened."

 

[chrmjenkins]

You guys are obviously talking about something else. I was talking about a major company CEO speaking to a Senate committee on USA taxation. His attitude (and interpretation) and theirs will be the point. Hint: It's right in the story title.

If you want to have a technical discussion about the nature of accounting and taxation laws, perhaps even GAAP, say that first. Don't jump into a different discussion and say it doesn't apply to your technical point, which isn't even being discussed. Just like I keep saying to people at work, "there's a lot of SHOULD being thrown around, and I have to deal with what actually happened."

We've been arguing that the VAT and other similar taxes are irrelevant to this discussion when it comes to corporate taxes. You are the one that brought up VAT in the first place.

While Cook may mention sales taxes as part of the overall tax scheme, his primary focus will be on corporate taxes, which logically and nominally, are not consumer taxes such as the VAT.

 

[Aragornii]

Um no. When I make $300k from a country with a low tax rate and am a US Citizen I am expected to pay US taxes on my worldly income. Usually there is an agreement for taxes less what was already paid.

What you're saying is correct, but that's not what I was talking about. I was talking about if you owned a business in a foreign country.

 

[JAT]

We've been arguing that the VAT and other similar taxes are irrelevant to this discussion when it comes to corporate taxes. You are the one that brought up VAT in the first place.

While Cook may mention sales taxes as part of the overall tax scheme, his primary focus will be on corporate taxes, which logically and nominally, are not consumer taxes such as the VAT.

No, I didn't bring it up. And the first thing I said is it doesn't count. Maybe you should read what I type instead of making up words that you think I think.

 

[LagunaSol]

Do you mean on sites that follow Apple or in general?

In general. Bad Apple news gets far more press than bad news about other companies.

 

[chrmjenkins]

No, I didn't bring it up. And the first thing I said is it doesn't count. Maybe you should read what I type instead of making up words that you think I think.

Let's just see...

The potential credit is only on "income" tax. And that is what Mr.damien is seeing, little "income" tax paid. However:

The problem is that many countries rely on sales taxes, which is what VAT is. So Apple (or anyone) will NOT get credit for paying 15-20% on their sales in those countries if they repatriate the earnings to the USA.

There are, of course, additional issues. I believe Apple has a bunch of its royalty-type sales 'located' in non-USA countries. That is how they could be considered to be hiding profits from the USA govt.

Welp, there you are, suggesting it's a problem apple doesn't get credit for taxes being paid by the consumer (VAT).

I don't see a point in responding further if you're not even going to acknowledge things you said previously.

 

[BiscottiGelato]

Taxes suck. Period.

This money would be here already if it wasn't for high tax rates.

We collect so much money in taxes we give it away to the rest of the world.

Government employees make way to much money. Look at the salaries that have been exposed in the last year of all the California gvt officials.

They are being an example. The example is, lets not put up with government being a roadblock to business and success through over taxation.

Government, taxes, regulation, licenses. All that is pushing this nation down. Reduce those things and we prosper.

----------



Shouldn't we have signs on our shores that say "Please bring your money here and spend it."

How could that be a bad thing?

Instead, let's tax it at 35% to discourage it from coming home.

I have to highlight this. Moral, Laws, Taxes, Accounting. Sure... Basic Economics trumps all.

But the politics is that it's in the government's interest to have big government. It doesn't matter what party or what president, the conflict of interest (government vs tax payers) will always exist....