Tim Cook to Testify In Front of Senate Committee Over Apple's Tax Practices

[MagnusVonMagnum]

Then do what he said. Vote to close the loopholes.

Yes, the next time the House is in session, I will call for a vote to close loopholes.

liberals love to say junk like "pay your fair share" etc. what they don't see is that more laws, more taxes, more regulation causes small businesses to pay way MORE than their fair share, and causes big businesses to pay less than their fair share. simplify the tax code by eliminating all business and personal income taxes and replace it with a consumption tax with food, medicine, and clothing from thrift stores tax exempt. that way, nobody can get around not paying taxes on things they choose to buy.

In other words, in reality it's the right that loves the tax code. But they also love to pay lip service and pretend they want to reform tax code. In reality, they only want to reform it for the rich. As you say, Corporations already pay next to nothing and YET the right SCREAM that our corporate tax rate is the highest in the civilized world (except that they conveniently leave the part out that almost no one actually pays any of it. It makes them look good to the so-called "Tea Party", though, who don't seem to understand what the original Boston Tea Party was all about taxation without representation whereas the modern one seems to be about "We don't want no stinking government period!"

Let's face, you have the far right (mainly rich old white boys who know how to get out of paying taxes), the far left (Please give us free stuff and welfare forever!) and yet it's the Middle (Class) that pays all the darn bills and has no real representation. I see no party for the Middle Class. I see a bunch of BS lip service paid to the Middle Class, but in the end, one side wants us paying all taxes for welfare and the other side wants us wiped out so there is no opposition to the "Ruling Class" like in the Middle Ages. Fairness is totally out of the question. But those of us in the middle are apparently too level headed to go out and demand real reform. We just pony up the taxes like good dogs and turn our heads (and votes) towards whatever side is offering us the best smelling dog treat.

 

[CQd44]

If we can chalk up one success of the last 5 years, it would be that Liberal democratic policies fail. They failed in the late 70's, the late 90's, and now for the last 5 years.

In your response to me, you pulled a typical liberal lie. You change the topic, gave unrelated facts, and never even responded to my post. Try investigating for yourself and stop following the leader...

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OK, you are incorrect, period. For example... A person/family that makes $40k-$50k a year will pay nearly zero income tax and then when they file, they will get a return that includes a crapload of credits back based on income, children/dependents, etc... These credits back will offset the sales tax and other misc taxes they paid over the year. They pay nearly, if not completely ZERO taxes. Its a joke and pathetic...

Then you get a politician that gets up and says the rich should pay their fair share. And all the takers, line up and take the lemmings walk!!

I wish I paid zero taxes. I make under 25k a year and pay about 15% from each paycheck and still ended up owing some this past april.

 

[Verbatim Cookie]

It still hasn't been moved! Somebody's asleep at the switch.

The discussion of a subsequent MacRumors news item about this is in PRSI already.

 

[applesith]

Apple create a lot of jobs in China, helping to stimulate the Chinese economy. Not sure how that stimulates the US economy though. Maybe if Apple decided to move manufacturing to the US...

All of the people working at apple HQ. apple store employees. Companies that have app teams. Apple accessory companies. Many American jobs. And what's wrong with in addition making jobs for people in other countries? They do way more than most companies.

 

[vvswarup]

[/COLOR]

On one hand I agree, on the other its flat wrong.

Yes, the current structure is a mess, rife with abuse, but on the other hand some minimal income tax is needed, less then 10% works fine. (a very long topic of discussion)


The part that Government does not create jobs is completely false, however.
Example: Roads, rail roads, bridges, ports, airports, etc are almost entirely built by government funds. They create millions of jobs, and in return stimulates tens of millions of more jobs. Infrastructure improvement is almost never a waste of money.

Another example: NASA and DARPA

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Where does the government get those funds to build roads, bridges, rail roads, and airports? They sure don't just create it out of thin air. The government gets those funds from the private sector. They build those roads, rail rods, bridges, airports, etc. in order to help the private sector. A private sector has to exist in order for the government to be able to spend money on infrastructure. The government by itself doesn't create jobs.

And infrastructure improvement can be a waste of money under certain circumstances. Infrastructure makes sense if the increase in economic output exceeds the investment in infrastructure. For example, in the 1930s, the US spent a lot on infrastructure. However, that didn't pay off until WWII because there was a sharp increase in demand for manufactured goods. That infrastructure was essential because it helped support high manufacturing capacity. That's when we saw the infrastructure investment create millions of jobs.

Spending for the sake of spending doesn't help anybody. Infrastructure spending is beneficial if it leads to gains in productivity. That's when you see those millions of jobs being created. But the infrastructure spending itself didn't create those jobs. It's the fact that there was demand for goods that necessitated more infrastructure in order to support more production.

 

[axual]

Ridiculous

Elected officials need to get their act together. There is one reason companies look to move stuff off shore ... it makes good business sense.

If politicians want to fix this, then remove the incentives and reform the tax code.

 

[Pyrrhic Victory]

With the same logic, without people there is no one to hire to run the company or pay the income tax. Then don't we deserve a better rate as well?

I'm not sure what your point is. Tax rates is not determined by some arbitrary opinion about what is deserved. They are determined by what is necessary to pay for already-budgeted expenses, and by what will result in maximum revenue (i.e. too high of a rate will actually result in less revenue).

 

[AaronEdwards]

All of the people working at apple HQ. apple store employees. Companies that have app teams. Apple accessory companies. Many American jobs. And what's wrong with in addition making jobs for people in other countries? They do way more than most companies.

Jobs in other countries don't really stimulate the American economy, they stimulate the economy of the other countries. The issue was the American economy, not the Chinese economy.

----

If it's something that Apple stimulates in the US, then it's the wallet of Tim Cook. I recall that he's earning at least 2000 times what the median Apple US worker is earning.

 

[gnasher729]

There is no double taxation involved. A corporation gets credit for foreign taxes paid - if the foreign nation has a higher tax rate than the US, no additional taxes are due.

The problem is that different countries set taxes in different ways. If you look at income tax, in one country your income tax might be higher because health service is paid from taxes, while in another country the tax might be lower because people have to pay for health insurance. So if you deduct taxes paid elsewhere, the result might be quite unfair (good or bad for you). Quite possible that in the USA, lots of things are paid through corporate taxes that in other countries would have to be paid by something that isn't called "taxes".

 

[applesith]

Jobs in other countries don't really stimulate the American economy, they stimulate the economy of the other countries. The issue was the American economy, not the Chinese economy.

----

If it's something that Apple stimulates in the US, then it's the wallet of Tim Cook. I recall that he's earning at least 2000 times what the median Apple US worker is earning.

You ignore all of the jobs apple makes in america. Yeah he earns a lot. I see you want re-distribution so there's little sense in using logic with you.

 

[cjoy]

"If you look at it today, to repatriate cash to the U.S., you need to pay 35 percent of that cash. And that is a very high number,"

Last I checked, Apple is asking businesses to pay 30% for providing a well maintained and safe infrastructure and bringing together vendors and buyers.

The United States is asking businesses to pay 35% on overseas _profit_ for providing a well maintained and safe infrastructure that allows apple as a company to strive and recruit well educated staff.

The difference is 5% you may think - the real difference is that apple takes 30% on the volume of sales, not just the profit. Imagine Tims rage if the government did the same and Apples profitability was cut down by 30%.

Yes, I'm comparing apples to , but still

 

[kingtj]

Not even a fair comparison at ALL ....

The government is FORCING companies to pay the double tax to get money (already taxed in the country it was earned in) into the U.S.

Apple is offering a VOLUNTARY service of letting you develop apps to sell in their online store, if you give them their 30% cut.

And when you do pay that 30%, you free yourself of any obligations to pay some other provider for all the bandwidth used to host your content. So there's clear value Apple brings to the proposition.

The government isn't giving a company ANYTHING extra when they pay those taxes to repatriate their money.

Last I checked, Apple is asking businesses to pay 30% for providing a well maintained and safe infrastructure and bringing together vendors and buyers.

The United States is asking businesses to pay 35% on overseas _profit_ for providing a well maintained and safe infrastructure that allows apple as a company to strive and recruit well educated staff.

The difference is 5% you may think - the real difference is that apple takes 30% on the volume of sales, not just the profit. Imagine Tims rage if the government did the same and Apples profitability was cut down by 30%.

Yes, I'm comparing apples to , but still

 

[AaronEdwards]

You ignore all of the jobs apple makes in america. Yeah he earns a lot. I see you want re-distribution so there's little sense in using logic with you.

Apple, considering how much money it makes, doesn't create a lot of jobs in the US. And most of its employees in the US are rather underpaid considering that same fact too.

Re-distribution? Did I argue for that? My point is that for what he has done so far, Tim Cook is extremely overpaid, and the average Apple employer, considering what they do, are rather underpaid. Or perhaps you think that Tim Cook, being the CEO while Apple is losing its position, is being fairly paid? Apple, right now, is following, not leading.

 

[AaronEdwards]

Apple is offering a VOLUNTARY service of letting you develop apps to sell in their online store, if you give them their 30% cut.

Apple is forcing you, if you want to sell apps for iOS, to do that through the App Store and give Apple 30% of every sale.

Contrast that with Android, where you have the freedom to set up your own app store and not having to sell your apps through Google Play.

The US government isn't forcing any company to pay a double tax (there really isn't one) either. To use your quote:

The US goverment is offering a VOLUNTARY service of letting US companies get money earned abroad into the US, if the company pays 35% minus the percentage already paid in the other country.

 

[applesith]

Apple, considering how much money it makes, doesn't create a lot of jobs in the US. And most of its employees in the US are rather underpaid considering that same fact too.

Re-distribution? Did I argue for that? My point is that for what he has done so far, Tim Cook is extremely overpaid, and the average Apple employer, considering what they do, are rather underpaid. Or perhaps you think that Tim Cook, being the CEO while Apple is losing its position, is being fairly paid? Apple, right now, is following, not leading.

So what's the magic ratio of money made to number of american employees? Most are underpaid, for what? Do they pay less than average retail, support, administrative, etc?

Most salaries don't decrease when you have poor performance (unless you are commission based), you either quit or get fired because you suck.

 

[MagnusVonMagnum]

Where does the government get those funds to build roads, bridges, rail roads, and airports? They sure don't just create it out of thin air. The government gets those funds from the private sector.

By private sector, I think you mean you and I because the funds mostly come out of the gas tax. IBM and your "private sector" doesn't pay a dime of it unless they're fueling up.

They build those roads, rail rods, bridges, airports, etc. in order to help the private sector. A private sector has to exist in order for the government to be able to spend money on infrastructure. The government by itself doesn't create jobs.

How odd. I guess I just imagined the postman delivering mail today. I know certain groups would like that to be a private sector job instead, but he looked pretty darn real to me.

And infrastructure improvement can be a waste of money under certain circumstances. Infrastructure makes sense if the increase in economic output exceeds the investment in infrastructure.

Spending for the sake of spending doesn't help anybody. Infrastructure spending is beneficial if it leads to gains in productivity.

You mean those pesky things like roads and bridges? Yeah, they don't make ANY SENSE AT ALL to pay for unless there's some big industrial park nearby. It would be far better for us to fall into the Mississippi River like the I-35W Mississippi River bridge (officially known as Bridge 9340) in Minneapolis Minnesota in 2007. Hell, those people didn't need that bridge! There wasn't any big industry moving into town so screw them. Swimming across the Mississippi is good exercise!

And who doesn't just LOVE driving into pot holes the size of your car like in Cleveland, OH or sink holes in Florida. Yeah, I hear you. What you say makes total sense!

 

[AidenShaw]

The problem is that different countries set taxes in different ways. If you look at income tax, in one country your income tax might be higher because health service is paid from taxes, while in another country the tax might be lower because people have to pay for health insurance. So if you deduct taxes paid elsewhere, the result might be quite unfair (good or bad for you). Quite possible that in the USA, lots of things are paid through corporate taxes that in other countries would have to be paid by something that isn't called "taxes".

Apple.com pays "health insurance"? Does Apple.com get a sniffle and need some drugs? Does Apple.com need funeral insurance?

I wonder if you're confusing "individual taxes" and "corporate taxes". They are for the most part completely different.

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The government is FORCING companies to pay the double tax to get money (already taxed in the country it was earned in) into the U.S.

There is *no* double taxation. Period.

Most of the funds in question are held in "tax haven" countries where little or no tax has been paid. For the rest, any taxes paid in the foreign country are credited towards the US tax bill.

Apple would never have to pay more than they would pay for equivalent profits in the US. There's no "double taxation", period.

 

[lazard]

The government is FORCING companies to pay the double tax to get money (already taxed in the country it was earned in) into the U.S.

wish people would stop bringing up this double taxation fallacy.

 

[vvswarup]

By private sector, I think you mean you and I because the funds mostly come out of the gas tax. IBM and your "private sector" doesn't pay a dime of it unless they're fueling up.

Let's say an IBM employee fuels up his/her vehicle. How exactly did they get the money to fuel up their vehicle? They're using what IBM paid them to fuel up. And IBM gets the money to pay them because of demand for their goods and services. So "you and I" are part of the private sector in that we work for companies in the private sector.

How odd. I guess I just imagined the postman delivering mail today. I know certain groups would like that to be a private sector job instead, but he looked pretty darn real to me.

The US Postal Service doesn't get taxpayer funding. They're not part of the federal budget. But now you mention it, how do you think they get the money to pay the postman? They get it through revenue from mailing packages and letters.

You mean those pesky things like roads and bridges? Yeah, they don't make ANY SENSE AT ALL to pay for unless there's some big industrial park nearby. It would be far better for us to fall into the Mississippi River like the I-35W Mississippi River bridge (officially known as Bridge 9340) in Minneapolis Minnesota in 2007. Hell, those people didn't need that bridge! There wasn't any big industry moving into town so screw them. Swimming across the Mississippi is good exercise!

And who doesn't just LOVE driving into pot holes the size of your car like in Cleveland, OH or sink holes in Florida. Yeah, I hear you. What you say makes total sense!

Don't you just love it when your government wastes money like a drunken sailor? Don't you love it when your tax dollars go towards paying salary and benefits to a government employee for a particular job when someone in that same job in the private sector could never dream of getting those benefits/salary? And before you say, I'm not talking teachers, firefighters, police officers, and ambulance drivers.

And what you are talking about is not investment. Maintaining an existing road/bridge is not an investment. It's just the cost of maintenance. Building new roads/bridges is an investment. I never said I was against maintaining what we already have. I am against building new roads/bridges that aren't going to lead to corresponding increase in productivity.

You have done nothing but overdramatize what I say which sounds great in a forum but is sorely lacking in any substance.

 

[etrinh]

Don't confuse morality with legality. There are a lot of things that companies should or shouldn't do and since you mentioned child labor, if child labor was legal, than there is no legal issue with companies taking advantage of that under the law. Please don't mix your morality with laws because what you determine to be moral will be different than another's persons morality.

If slave or child labor became legal, and it was cheaper than any other kind of labor, and the quality of work was just as good, does that mean that because of this obligation that Apple has to start with slave or child labor?

If it became legal to dump industrial waste everywhere, does that mean that Apple now has to dump its waste everywhere since it's a lot cheaper than to actually take care of it and Apple has an obligation to maximize its profits?

 

[etrinh]

What is your tax bracket and income range? I can safely assure you that I pay about 25% in federal taxes and I do not get that money back in refunds.

If we can chalk up one success of the last 5 years, it would be that Liberal democratic policies fail. They failed in the late 70's, the late 90's, and now for the last 5 years.

In your response to me, you pulled a typical liberal lie. You change the topic, gave unrelated facts, and never even responded to my post. Try investigating for yourself and stop following the leader...

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OK, you are incorrect, period. For example... A person/family that makes $40k-$50k a year will pay nearly zero income tax and then when they file, they will get a return that includes a crapload of credits back based on income, children/dependents, etc... These credits back will offset the sales tax and other misc taxes they paid over the year. They pay nearly, if not completely ZERO taxes. Its a joke and pathetic...

Then you get a politician that gets up and says the rich should pay their fair share. And all the takers, line up and take the lemmings walk!!

----------

'Contrast that with (insert "open source" Android' should be the proper idea you are trying to convey. Apple doesn't force you to do anything. You can choose not to participate in the IOS development.

Apple is forcing you, if you want to sell apps for iOS, to do that through the App Store and give Apple 30% of every sale.

Contrast that with Android, where you have the freedom to set up your own app store and not having to sell your apps through Google Play.

The US government isn't forcing any company to pay a double tax (there really isn't one) either. To use your quote:

 

[dmax35]

Maybe before senate committee's scrutinize other companies income. They need to look in the mirror for their frivolous spending.

They need to participate in the "salvation of the country". Why not cut their travel, per diem and lodging budget, and mandate to pay their fair share instead of allowing them to write off donations of their chosen charities.

 

[0dev]

As long as what they're doing is legal tax avoidance rather than illegal tax evasion (massive difference between those two), they should keep doing what they're doing. Business is business.

 

[kingtj]

re: double taxation

If the funds are actually held in a "tax haven" country where no tax is paid, great. Good for Apple for finding a nation willing to do that. I don't see how that changes ANYTHING in the debate though? Your whole argument, given this scenario, is basically that they should gladly accept getting taxed once by the USA - simply because the other place they have the funds doesn't impose a tax.

Apple isn't some kind of charitable organization that's supposed to willingly give away some of its profits to the government its corporate HQ is located in. (For that matter, even if Apple WANTED to be that charitable - it would be strongly advisable to direct those funds to the individuals or groups it wished to assist, rather than giving it to the U.S. Federal govt. - who would simply loan a bunch of it back out to China, blow it on the "war on terror" and military spending, and so forth.)

There is *no* double taxation. Period.

Most of the funds in question are held in "tax haven" countries where little or no tax has been paid. For the rest, any taxes paid in the foreign country are credited towards the US tax bill.

Apple would never have to pay more than they would pay for equivalent profits in the US. There's no "double taxation", period.

 

[AidenShaw]

If the funds are actually held in a "tax haven" country where no tax is paid, great. Good for Apple for finding a nation willing to do that.

Good for Apple to find a tiny Caribbean island to channel funds to.

Bad for the US, and any other country where Apple actually does business.