Cupertino's Mayor: Apple 'Abuses Us' By Not Paying Taxes (theguardian.com)

An anonymous reader shares a report on The Guardian: Apple pays a 2.3% effective tax rate on its $181bn in cash held offshore, according to Citizens for Tax Justice, a not-for-profit research group focusing on tax policy. Citizens for Tax Justice estimates that Apple would owe $59.2bn in U.S. taxes if the money weren't funneled into offshore shell accounts. Criticism over the company's offshore tax schemes has become more pointed in recent months, both locally in Cupertino and from Apple's own staff. At a recent Cupertino city council meeting, some residents protested about a lack of funding for public projects, Barry Chang, Mayor of Cupertino said: "They ball up the paper and throw it, and they say 'You're making all the wrong decisions'," Chang said. "In the meantime, Apple is not willing to pay a dime. They're making profit, and they should share the responsibility for our city, but they won't. They abuse us."

Comments

Not funneled into

[SuperKendall]

All of that money is money earned overseas. So it's not "funneled" anywhere, it's just not brought back

Why? Because the government makes it absurdly expensive to bring money back to the U.S. - money Apple has already been taxed on overseas.

Apple has said repeatedly it would be happy to bring that cash back if it had a much more reasonable percentage to pay in taxes on it. So if the government really wants it, it can have that money any time simply by making the tax rates for corporations something more in line with what the rest of the world has.

Re:Not funneled into

[Anonymous Coward]

But with the crash of the Euro, it would be have been less expensive to bring it back and pay the taxes. Only a fool keeps cash in the Eurozone.

Re:Not funneled into

[Anonymous Coward]

oh i didn't know getting out of double taxation was an option?
corp taxes are on corp profits and should be paid after all expenses like the corp jets and dinners and wine and blow jobs, are accounted for. and those are paid where the headquarter is.

Re:Not funneled into

[zlives]

really!!! business must be booming in Ireland to account for such profits.

Re:Not funneled into

[Anonymous Coward]

They would only have to pay the difference between the amount they already paid and what the US tax rates are. They wouldn't have to pay full taxes on it a second time.

Re:Not funneled into

[Austerity Empowers]

There shouldn't be a negotiation and they shouldn't be asking Apple (or anyone else) to volunteer. There should be a law, the amount owed should be definite, failure to pay would be a crime. That law should apply to everyone, equally.

Until the government, at all levels, fixes their shit, their shit is going to be broken. I am tired of hearing about Apple or Google or Facebook doing NOTHING wrong, but accused of something that sounds like (but is not) a crime.

We have set up a system where there is a game, and good players are going to game the system. So fix the system or fix the game.

Re:Not funneled into

[jellomizer]

A lowering in currency rates, could also mean a big windfall, if they invest a lot into it, and the Euro improves.

Re:Not funneled into

[Anonymous Coward]

That's too funny. Look up "Double Irish". Apple (remember "designed in the US"?) licenses its IP to an Irish subsidiary that exists only to launder the money for tax purposes. Some how a phone made in China gets shipped to and sold in the Apple Store in Cupertino but the profit was earned in Ireland.

Re:Not funneled into

[fonos]

Don't know why this is marked as being a Troll, it's factual information. The US is the only developed nation in the world that taxes companies based on worldwide profits, not just profits earned in the US. Yes, you get a tax credit for income tax you pay to other countries, but the end result is you end up paying the high US corporate income tax rate on income earned everywhere in the world, whereas foreign companies only pay the high US tax rate on income earned in the US, and the lower tax rates of income earned in other countries. This makes foreign companies a competitive advantage over US companies. Not a great policy in my opinion.

Re:Not funneled into

[__aaclcg7560]

All of that money is money earned overseas. So it's not "funneled" anywhere, it's just not brought back

US profits are funneled through a Nevada subsidiary because Nevada doesn't have a corporate tax.

http://www.nytimes.com/2012/04/29/business/apples-tax-strategy-aims-at-low-tax-states-and-nations.html

Re:Not funneled into

[Anonymous Coward]

What makes you think the money is in Euro's? Or actually in the Eurozone? My bet is that the money is in short term paper (bonds) at Goldman Sachs. The offshore bit is tax accountant hooey and means nothing about where the money actually is

Re: Not funneled into

[Anonymous Coward]

Apple keeps its money in the Cayman islands. Irelnd and other EU outposts are also abuse centers, designed to employ the maximum number of Asians and pay little or no tax. They really screw Irish people through "double-Irish" tax loophole and usurp Irish people out of their country effectively to be replaced with the nee irish - Indians!

Re:Not funneled into

[Anonymous Coward]

There should be a law that says "if you have any presence at all in our country, all the money you earn in other countries, and that is taxed in those other countries, should be taxed here too?

Sounds like a stupid law.

Re: Not funneled into

[macsimcon6500]

Apple is already the top taxpayer in Cupertino. And in California. And in the whole fucking country! While it would have been politic for Steve to mollify the city council by building free wifi for the city after they requested it, it wasn't a requirement for the deal. Until Congress closes all the loopholes, government officials should shut the fuck up about corporate taxation. Apple, Cisco, et al are just playing the rigged game by the rules. And why do they always pick on Apple instead of the dozens of Fortune 500 companies which pay no tax, or worse, get refunds?

Re: Not funneled into

[Anonymous Coward]

Congress won't do anything if people are just told to shut up, whether government officials or not.

It is why the right to petition the government is protected.

So stop telling people to shut up. Start telling Congress to listen.

Re:Not funneled into

[Anonymous Coward]

Yes, but Apple, Google and Facebook PAY them not to fix their shit. It's fine to say "They just pay by the rules" but when they own the people who make the damned rule too, it's not surprising we think they're ripping us off.

There should be a law, but companies like Apple work damned hard to make sure there isn't one.

Re:Not funneled into

[Anonymous Coward]

It isn't earned overseas. Apple transfers their IP to foreign subsidiaries and pay licensing fees based on revenue to themselves, hence transferring their profits outside the United States. There is nothing absurd about the tax, it is the 35% corporate tax.

Re:Not funneled into

[140Mandak262Jamuna]

There should be a law that says "if you have any presence at all in our country, all the money you earn in other countries, and that is taxed in those other countries, should be taxed here too?

Sounds like a stupid law.

It is not stupid. As the law stands you deduct taxes already paid to other governments from the tax you own USA. Lets say 100 million dollars in USA. Then Apple sets up a post box in Banana Republic, and parks all the profits there and pays a generous 1 million dollars to the government of Banana Republic. Then it owes only 99 million to USA. The law is intended to prevent a race to the bottom. Competing governments reduce their tax rates to woe the companies and the corporations play one jurisdiction against another.

That is the current law. All taxes paid to all other governments count as though they have been paid to the US government. But, if they tax you less than USA, you pay the difference to the USA. The only glitch is, current law taxes the profits only when they are brought into the USA. So they keep the profits indefinitely off shore to dodge the tax. Hoping for an amnesty and bring it home with a lower rate to wipe the slate clean.

We should change the law to make these corporations that are keeping profits abroad from being listed in US Regulated stock exchanges. That will bring the profits home and they will pay the taxes. Or we could list them as foreign businesses with severe restrictions in lobbying and campaign contributions. That would also create a penalty for gaming our tax code.

Already the corporations have shifted most of their tax burden to the individuals. If the corporations paid the same effective rate as they paid under Ronald Reagan individual tax payers will get an immense tax relief. We can take our personal income tax rates from 36.3% top rate down to 20% top rate or even a flat tax of 15%.

All of them will shout tax cuts. Individuals and middle class gets a few bones thrown to us. The bulk of it goes to these corporations.

Re:Not funneled into

[DogDude]

You're right. That's why Bernie Sanders is doing so well. He's one of the very few politicians that want to fix the system. We have legalized bribery in this country and the big companies use it to their advantage.

Re:Not funneled into

[AK Marc]

All of that money is money earned overseas. So it's not "funneled" anywhere,

It's funneled to Ireland to not funnel it to the US.

the government makes it absurdly expensive to bring money back to the U.S.

That's why arbitrage should be illegal. I don't care if you don't want to bring money back to the US, but if that's your stance, then move your offices to Ireland. Having a PO box in Ireland (and maybe some accounting contractors) isn't a nexus. Apple is so proud of "designed in Cupertino" until the sale is made, then it's "based in Ireland".

That is a fraud, and should be punished as such.

Re:Not funneled into

[fustakrakich]

good players are going to game the system

What does that mean? The "system" is working exactly the way they designed it to function. The failure seems to be in comprehension of the rules and acknowledging the role we play. Of course that could be by design also. The flaw that needs "fixing" is not there, it is here.

Re:Not funneled into

[gorbachev]

The politicians who have the power to fix these issues have negative incentives for fixing this issue. The flow of money from corporate campaign donations would magically funnel to candidates who completely coincidentally oppose fixing the tax code.

This is why campaign finance reform is such an important issue. The corruptive nature of all that money from corporations and rich folks is skewing our public policy.

Re: Not funneled into

[Anonymous Coward]

Sounds smart to me, apple and many other companies could pack up and move all operations out of the USA forever and stay in low tax countries.

Re:Not funneled into

[sootman]

> We have set up a system where there is a game, and good players
> are going to game the system. So fix the system or fix the game.

Any time you establish rules, people will figure out how to use those rules to their advantage. Money is a self-feeding machine -- the more money you make, the more you can spend on accountants and lawyers to help you figure out how to make and keep more money. (And no sense mentioning that once you have enough money, you can start buying the laws you want anyway.)

Tax based on profits? OK, we'll figure out a way to keep our books to show no profit. Tax based on sales? OK, we don't sell things, we lease or rent them. Tax based on cash hoard? OK, we'll figure out a way to spend every penny we make. Number of employees? Sorry, we only have contractors. Executive pay? Our executives make $1/year, and then we give them stock and benefits. Etc etc etc.

Every rule, by definition, will give SOMEONE an advantage. Any entity with money *will* figure out a way to make sure that "someone" is always THEM.

Re: Not funneled into

[AK Marc]

Apple is already the top taxpayer in [...] the whole fucking country!

Then why does Forbes list Exxon and Chevron as paying more tax? http://www.forbes.com/pictures...

Re:Not funneled into

[Anonymous Coward]

Money earned offshore is taxed when you bring it in. However, the tax is only differential. i.e. US taxes at 25%. Cayman Island taxes at 10%. Corp earns 1M (profit). Cayman taxes = 100K. US Taxes = 150K. That's not double taxation. There's even provision for tax credits, IIRC.

Re:Not funneled into

[Obfuscant]

Already the corporations have shifted all of their tax burden to the individuals.

FTFY. Who do you think really pays the taxes on corporate profits? The customers, of course, Taxes are a cost of doing business, and they get passed on just like the cost of electricity or labor.

The only glitch is, current law taxes the profits only when they are brought into the USA.

Why should the US get a tax bite out of profits made outside the US?

Re:Not funneled into

[Anonymous Coward]

So if I currently own and run business in Japan, and that's it, all the money I make in Japan is taxed in Japan, and then I get to keep it. So, I decide to open an office in the USA. I make a little money there too. Suddenly all the money I am continuing to make in Japan is taxable in the USA, even if I never move it to the USA? How does that even make sense?

One thing is for sure, that will give businesses a huge incentive to never set up shop in the USA. I am sure THAT would be good for the American economy!

Or course, Apple's scenario is just the opposite. They started in USA and decided to open a foreign office, which makes money in that foreign country, legally pays taxes to that country (because that is where it was earned), and keeps it there. The situation is the same, but in reverse. Are you saying that all the money made in the USA office should now be taxable in the foreign country too?

Basically that all multinational businesses must pay taxes on all the money they make, in any country, to every country in which they have a presence?

Ridiculous!

Or are you just saying that the USA is special, and any business with a presence in USA should pay taxes on its global earnings to the USA, but other countries should not claim taxes on money made from USA-based offices?

Re: Not funneled into

[Anonymous Coward]

[[Citation Needed]]

Re:Not funneled into

[Anonymous Coward]

>As the law stands you deduct taxes already paid to other governments from the tax you own USA. Lets say 100 million dollars in USA. Then Apple sets up a post box in Banana Republic, and parks all the profits there and pays a generous 1 million dollars to the government of Banana Republic. Then it owes only 99 million to USA.

What I heard, as a large business owner, is that I should buy Sealand (or at least work with the owner, could keep a small stipend for himself), set the taxes to 100%, take all money the country generates and make it payable to my company, and then after funneling the money through there, I can bring it into the USA tax free.

Up your game all you want. I'll up mine to match.

Re:Not funneled into

[DarkOx]

There should be a law, the amount owed should be definite, failure to pay would be a crime.

There is, and the tax code does. Its just that its a very complex set of rules. You and I can play chess, who wins depends on who leverages the same set of rules better. You and I can play tick-tack-toe and unless one of us isn't paying any attention at all, whoever goes first will always be the winner.

You can argue the tax code should be more like tick-tack-toe, clear and offering predictable outcomes. I agree it should be that. Because the tax code we have to day leaves all kinds of room for 'avoidance', that is using the rules better but following them, as opposed to evasion breaking the rules and not paying what is owed.

The real problem is that we went about social engineering with our tax code. We created this incentive, that deduction, etc to try and get people and companies to do this or that. We created are large number of complex rules and classes of actors and the result is a gameable system. That will always be the result.

My solution: A pure consumptive tax on all goods and services (with a few exceptions) inclusive of financial instruments at time of purchase. No filing requirements. The exceptions would be for goods like medical services, unprepared foods, legal services, public transportation fairs, tuition at accredited schools, clothing that is more than 50% cotton. People could optionally choose to file if they are willing to attest their gross income is below a certain threshold and could apply for additional rebates on things like transportation fuel, utilities at a primary residence, education related items and possibly some others.. Business would pay no taxes except on goods and services they purchase.

Right now the system is terrible large corporation with armies of tax attorneys and the ability to go municipality or even sovereign shopping benefit immensely. You and I probably pay more than what we owe because we don't have the resources to study every possible deduction and resarch every life decision we make to see what incentives are out there, fear the IRS and are afraid to do certain things that might be correct but are 'audit flags' etc.

Re:Not funneled into

[oh_my_080980980]

Actually, APPLE is whining about paying taxes on money that APPLE WANTS to bring back to the United States.

Fuck off ass-hole.

Re:Not funneled into

[imgod2u]

In the case of many corporations, a good deal (~40%) of their profits come from overseas. So yes, if heavier taxes were levied on them, foreign nations who purchase goods designed/made by United States companies would contribute to the U.S. tax system. That seems perfectly legit.

Taxes are levied, in theory, on agents who benefit from protections and perks offered by the United States. If a corporation is based in the United States and especially if it's publicly trade in the United States, it enjoys immense benefits and protections offered by the laws of the United States both domestically and abroad. From legal protection of its various properties to the infrastructure built to allow it to operate its design and research centers to the American talent it can draw upon to invent.

The later especially applies to tech companies. Their competitive edge is gained by hiring the talent available to them in the United States. Why shouldn't their profits -- no matter where they earn it -- that is derived from the inventive and productive power the US offer be taxed to benefit the system they've benefited so much from?

Re:Not funneled into

[DarkOx]

Already the corporations have shifted most of their tax burden to the individuals. If the corporations paid the same effective rate as they paid under Ronald Reagan individual tax payers will get an immense tax relief. We can take our personal income tax rates from 36.3% top rate down to 20% top rate or even a flat tax of 15%.

Nonsense corporations don't pay taxes, not really. If you close the loop holes and make them really pay the 35% rate it will only hurt the middle class. Prices of goods and services will rise wherever the costs can be passed on. In certain highly competitive markets that won't happen but in most it will. What is certain to happen in more wage stagnation while inflation marches on.

What we need to do is kill the idea of income and profit taxes! Taxation should occur on the consumptive side.

Re:Not funneled into

[Anonymous Coward]

Is this the world's worst haiku, or were you just really out of breath?

Re:Not funneled into

[ausekilis]

It's not as simple as lowering corporate tax, since that would cause us to go deeper into debt. Instead we need to make up that revenue elsewhere. The problem isn't just that our corporate taxes are high, it's that our personal taxes our low too. U.S. taxes are catered toward individual wealth instead of "public wealth".

We tax corporations heavily while taxing the populace (comparatively) lightly. To add some perspective, one thing taught to me early on is "you work one week a month for uncle sam" implying a roughly 25% effective tax rate... that's light compared to a large part of the world.

Sorry folks, we can't just lower corporate tax... We'll need to start taxing individuals a hell of a lot more. I say we start with the 1% and work our way down.

Re:Not funneled into

[bondsbw]

We should change the law to make these corporations that are keeping profits abroad from being listed in US Regulated stock exchanges. That will bring the profits home and they will pay the taxes.

I don't see much of a relationship between having off-shore profits and the stock exchanges, so I'm not really fond of this plan. Plenty of companies are privately owned and they would not be affected.

Or we could list them as foreign businesses with severe restrictions in lobbying and campaign contributions. That would also create a penalty for gaming our tax code.

Now you're talking. I'm not entirely sure how to implement the cutoff. Keeping $1 out of $100B offshore shouldn't qualify them as foreign, but keeping $1 out of $100B in the US shouldn't exempt them from such a law. Should it be based on a dollar amount, a percentage, or some other criteria? It's important to choose criteria where gaming the system would not be a good option.

Already the corporations have shifted most of their tax burden to the individuals. If the corporations paid the same effective rate as they paid under Ronald Reagan individual tax payers will get an immense tax relief. We can take our personal income tax rates from 36.3% top rate down to 20% top rate or even a flat tax of 15%.

That's just shifting the money. Say your company averages $10K per employee in corporate tax, and each employee averages $10K in income tax. Shifting it so that the company pays $15K on average and the employee pays $5K on average will just mean the employee's base pay will go down by $5K. At best it will be phased in over time and raises will suffer until everything has evened itself out. There is no such thing as free money or corporations cutting profits out of the goodness of their hearts.

Re:Not funneled into

[Anonymous Coward]

> The US is the only developed nation in the world that taxes companies based on worldwide profits, not just profits earned in the US.

This is not even close to true. It's a talking point that is endlessly repeated because people can't be bothered to spend 15 minutes of their own research.

Canada (G7 member) - "Corporations resident in Canada (whether owned by Canadians or nonresidents) are taxed on their worldwide income from all sources, including income from business or property and net taxable capital gains. Nonresident corporations are taxed only on certain Canadian-source income."

Mexico - "Corporations resident in Mexico are taxable on their worldwide income from all sources, including profits from business and property. A nonresident corporation in Mexico is subject to profits tax on income earned from carrying on business in Mexico."

Japan (G7 member) - "Japanese domestic companies are subject to tax on their worldwide income, but nonresident companies pay taxes only on Japanese-source income."

Italy - "Resident companies are subject to corporate income tax (imposta sul reddito delle società, or IRES) on their worldwide income."

Germany (G7 member) - "Corporations, such as stock corporations (Aktiengesellschaft, or AG) and limited liability companies (Gesellschaft mit beschraenkter Haftung, or GmbH), that have their corporate seat or place of management in Germany (resident corporations) are subject to corporate income tax (Koerperschaftsteuer) on worldwide income, unless otherwise provided in tax treaties."

South Korea - "Korean domestic corporations are taxed on their worldwide income, including income earned by their foreign branches."

And so on and so forth.

Source - http://www.ey.com/GL/en/Services/Tax/Worldwide-Corporate-Tax-Guide---Country-list

Re:Not funneled into

[Anonymous Coward]

Because trolls can't keep their facts straight. Also: somebody should inform Chile, Ireland, Israel, South Korea, and Mexico that they aren't "developed nations," because they use the same worldwide tax system we do; and most European countries are considering it, given what's been disclosed in the Panama Papers.

Re: Not funneled into

[mspohr]

They create a foreign shell corp and give it IP. The shell collects royalties on worldwide sales which just happen to equal profts.
Result is that there are no profits for the US or CA.

Re:Not funneled into

[smallfries]

It is still stupid.

If corporations are allowed to pay tax on "profit" then they will continue to game the system. Make them pay tax on income - in the territory that they earned the income. Then there is no game to play.

Re:Not funneled into

[srmalloy]

That is the current law. All taxes paid to all other governments count as though they have been paid to the US government. But, if they tax you less than USA, you pay the difference to the USA. The only glitch is, current law taxes the profits only when they are brought into the USA. So they keep the profits indefinitely off shore to dodge the tax. Hoping for an amnesty and bring it home with a lower rate to wipe the slate clean.

As I understand it, the law also restricts your tax obligation to profits, and by using financial tricks like the 'double Irish with a Dutch sandwich' method, companies can shift revenues that would have been counted as profits and taxed in the US overseas through a country that levies a much lower tax rate, and then ultimately into a tax haven, so that a company that would otherwise be paying $10bn in US taxes might take 90% of their putative profit, send it to an overseas corporation in a low-tax country as a licensing fee for the intellectual property associated with its products, then instead of paying, say, $90M on those licensing fees, pay 90% of their income as a licensing fee through a foreign holding company to a paper subsidiary in a tax haven like Bermuda, reducing their tax burden on the licensing fees to $9M -- and by this shell game of licensing, reducing their tax burden from $10bn paid to the US to $1bn paid to the US and $9M paid to the government of the country where the first holding company is located.

Re:Not funneled into

[guises]

US companies have had no difficulty competing internationally - the US corporate tax rate is what it is because US companies have done so well, and can afford it. The story in question is about Apple, the most profitable company in the world, who would still have $120bn in cash even if they paid their taxes. The only reason why they're not paying those taxes is because they don't really need the money. They're so rich that they can afford to just leave the money there, because it isn't needed for their operations.

In other words, if anything their taxes should be higher. Stockpiling money, stockpiling anything, is detrimental to the economy and needs to be discouraged (though taxes aren't the only way to do this).

Re: Not funneled into

[Anonymous Coward]

Please try to actually do some reading before you post complete misinformation. Apple doesn't offshore it's patents they are owned by Apple US. Apple is one of the top 3 tax payers in the country. What they don't pay taxes on in the us is items sold and made in other countries.

Re:Not funneled into

[cayenne8]

It's not as simple as lowering corporate tax [americansf...irness.org], since that would cause us to go deeper into debt. Instead we need to make up that revenue elsewhere. The problem isn't just that our corporate taxes are high, it's that our personal taxes our low too. U.S. taxes are catered toward individual wealth instead of "public wealth".

Seriously???

I pay easily in the 33% tax range...not including all the sales tax, gas tax and other essentially double taxation bit of money the city, parish, state and feds add onto everything in daily life.

The Federal Govt is bringing in RECORD levels of tax revenue as it is.

Enough is enough.

I think 33%+ is plenty if not too much already.

Govt spends way too much.

Why are we giving so much money to foreign governments? Stop that.

If we pull back from being the worlds police force, that would help too.

We have tons of fraud and waste in all levels of our government....get in there and seriously cut the crap.

No one should have to pay up to or over 50% of their income in taxes....that kills incentive to work harder, or hire others.

And yes..this is the US.

We were built on individualism, and personal responsibility and growth. That's what made this country great and how it excelled over most every other country in the world to date.

If you want the greater good, socialistic type polices, and you think the govt knows MUCH better than how how YOUR money would be best spend and redistributed amongst the collective, well, like you said, there are other countries out there that are better suited for you politics and lifestyle.

Me?

I want just enough government to enforce contracts, laws, basic infrastructure, national defense, etc.....and then, get the fuck out of my life.

I just want to be free to pursue my happiness and fortune as unabated as I possibly can. Hopefully along the way, I can benefit my family, friends and charities....as "I" think I can best decide to do, rather than have the decision made for me by one size fits all government folks.

Re:Not funneled into

[Anonymous Coward]

You're right. That's why Bernie Sanders is doing so well.

"So well?" He's so far behind in the delegate count he has not quite been mathematically eliminated, but he's hanging by a thread at this point.

Re:Not funneled into

[zerosomething]

There is a law and Apple complies with it to the letter. Even if they did bring more of their oversees profits home it wouldn't benefit Cupertino one bit. Apple pays their local property taxes so what's the problem? I'm really getting tired of this "Fair Share" BS, as if there is a limited amount of money and if we don't take some we won't get any. BS!

Re: Not funneled into

[Anonymous Coward]

Apple's presence in Ireland isn't a PO box Ora token office. It's several offices with thousands of employees.

Re:Not funneled into

[Anonymous Coward]

Bernie is objectively a complete fucking idiot that doesn't understand even the absolute basics of economics. If Bernie was allowed his way we'd be a third world shithole by the end of his first term.

Re:Not funneled into

[Impy the Impiuos Imp]

They pay in each country according to the transactions in that country. What you say is pure rhetoric any politician can use anywhere in any country.

Now every fucking country is taxing all income or profits because They Are So Damned Special to the global success.

Re:Not funneled into

[Anonymous Coward]

If there's so much talent in the US, why do you need all those HB1 visas?

Re:Not funneled into

[fonos]

It may not be stupid, but it makes American companies less competitive compared to their foreign competitors. A British company will pay 20% tax on its profits from the UK, 35% tax on its profits from the US, and 15% on its profits from Germany. However, if this company was headquartered in the US instead, it will simply pay 35% tax on all profits worldwide, making the US company less competitive.

Re:Not funneled into

[cob666]

It is not stupid. As the law stands you deduct taxes already paid to other governments from the tax you own USA.

This only applies to countries that have tax treaties with the US.

Re:Not funneled into

[Anonymous Coward]

If there's so much talent in the US, why do you need all those HB1 visas?

Are you trolling? Because they get paid less and are easier to control. Idiot.

Re:Not funneled into

[Anonymous Coward]

then you should feel right at home you backwoods neckbeard fucktard.

Re:Not funneled into

[cob666]

Taxing income alone is a horrible idea. I have a client (IT Consulting) that due to digital media tax credits actually operate at close to a loss. If they were taxed on the several million dollars in revenue they take in they would be forced to close their doors.

Re:Not funneled into

[Anonymous Coward]

They would only have to pay the difference between the amount they already paid and what the US tax rates are. They wouldn't have to pay full taxes on it a second time.

The difference is 22.5%. US 35% - Irish 12.5%. 22.5% is a pretty big incentive to figure out how to spend money in the EU.

Re:Not funneled into

[Anonymous Coward]

Now iPhones made in China and sold in other countries are taxed there. The money remains overseas.
iPhones made in China and sold in the US are taxed here.

What is not happening is: iPhones made in China and sold outside of the US being taxed in the US.
If a iPhone is made in China and sold in Germany, or Malaysia, or Australia, or Peru, it is taxed there and not in the US. Would it be better to pay those international taxes and then ~also~ pay an ~additional~ 35% to bring the money to the US? Why then would any US company sell products overseas? For a 50% (or similar) tax rate?

Re:Not funneled into

[Anonymous Coward]

Money earned offshore is taxed when you bring it in. However, the tax is only differential. i.e. US taxes at 25%. Cayman Island taxes at 10%. Corp earns 1M (profit). Cayman taxes = 100K. US Taxes = 150K. That's not double taxation. There's even provision for tax credits, IIRC.

US taxes are 35% not 25%. Irish taxes are 12.5% That's a 22.5% difference, quite an incentive to find a way to spend those euros in the eurozone rather than repatriate to the US.

Re:Not funneled into

[Anonymous Coward]

You are quoting without understanding. None of the above applies to income earned by foreign subsidiaries of a Canadian, Mexican, Italian, German, South Korean company. In other words, if the parent Canadian corporation earns money in Ireland, then Canada will tax it. If an Irish subsidiary of a Canadian corporation earns money, Canada will not tax it.The rules are different if the income is investment income instead of business income.

By the way, if you had said Brazil, you would have been right.

Re:Not funneled into

[Whorhay]

I think a big part of the problem is how people and companies define "earn". Microsoft for instance produces most of its products out of offices in Redmond. Those products are then licensed to customers through a relatively tiny office in Nevada or somewhere that has a much lower tax rate. By doing this Microsoft can claim all of their profit in a State that minimizes their tax rates, and they get to claim the Redmond offices as a loss because they don't bring in any profits, even though it is the Redmond office actually building the product. Most reasonable people would look at this and say that the profits are earned where the product is produced, not simply where it is sold.

Re: Not funneled into

[Anonymous Coward]

Because Exxon and Chevron are paying more taxes to foreign countries. The forbes articles includes both US and non-US income taxes,

Re:Not funneled into

[Anonymous Coward]

Wake up from this dream, reality is calling.

Re:Not funneled into

[Anonymous Coward]

Wait, so the iPhone built in china and sold in Germany should be taxed at triple the rate that the governments of China and Germany have levied? How's the US deserve to take double that cut? Oh, from the app developed in Germany that's bought by the German dude? Hmm ... your logic is assfucked.

Oh, and, understand that the "only 40%" tax rate is a lie, because see, well, real people own stocks, so they get taxed on the dividends. Yes, your pension fund owns the stock, and you get to pay income tax AGAIN when you get your pension payment.

Fuck those evil moneygrubbers for paying taxes only once instead of 3 times.

Re:Not funneled into

[DMJC]

But Apple isn't being taxed overseas. We know they're offshoring profits made in Australia, and the same deals are being made worldwide. The USA needs to crackdown in concert with the other OECD members. It's time to cut the bullshit. All of these companies are dodging tax.

Re:Not funneled into

[AmiMoJo]

Just have a body that enforces the spirit of the law. If anyone is in any doubt, they can just ask and if necessary argue it in court up front.

Re:Not funneled into

[Tuidjy]

You and I can play tick-tack-toe and unless one of us isn't paying any attention at all, whoever goes first will always be the winner.

I hope that tick-tack-toe is a different game involving ticks and tacks, and not the tic-tac-toe I know. Because if both players are over 5 years old and have an IQ over 50, the game I know is always drawn.

Re:Not funneled into

[Anonymous Coward]

Which isn't what is happing and being complained about.

Apple has a holding company in Ireland of which owns IP amongst other things. That IP is then licensed back to say...Apple Stores.

Apple Stores must pay the holder of that IP for the right to use the apple logo in the physical stores.

Apple Stores then cuts checks to Apple Holdings in Ireland while simultaneously making that cash an expenditure instead of a profit. This reduces the profit margin that Apple stores claims. That money is then taxed in Ireland at some crazy low rate.

This deprives local jurisdiction of tax money that essentially is used to provide the necessary services that Apple Stores consume.

This is just an example of how the game is played.

Re:Not funneled into

[Anonymous Coward]

Oh you didn't follow the spirit of the law and donated to the GOP? You owe taxes.

Oh you didn't follow the spirit of the law and donated to the DNC? No taxes due.

Yea, just let a couple of people decide if you owe taxes based on how they feel the spirit of the law is. That is how you get people running private email servers with top secret information in order to avoid FOIA requests and then not get prosecuted for it.

Re:Not funneled into

[brewthatistrue]

It may not be stupid, but it makes American companies less competitive compared to their foreign competitors.

Well when you put it that way ...

it sounds stupid.

Re:Not funneled into

[lgw]

My solution: A pure consumptive tax on all goods and services

Unconstitutional, which is probably for the best as a sales tax would never replace the income tax, it would just be piled on.

Instead, what about a simple fixed tax rate, for all income, personal and corporate, all (inflation-adjusted) capital gains, no exceptions, no special cases. Make it a payroll tax, and most people never have to file anything. Let the broker collect the tax on investments, and that's taken care of too. No system to game.

Re:Not funneled into

[Solandri]

Already the corporations have shifted all of their tax burden to the individuals.

FTFY. Who do you think really pays the taxes on corporate profits? The customers, of course, Taxes are a cost of doing business, and they get passed on just like the cost of electricity or labor.

By definition, corporations can't pay taxes because they're just paper entities. All the productivity they generate is generated by the employees. When you talk about "Walmart", you're actually talking about the sum total of everyone who works at Walmart or owns it. What Walmart does is what they do. Money Walmart makes is what they make. Money Walmart pays to suppliers is what they pay. Money Walmart wastes is money its employees waste.

So of course corporate taxes are paid for by its customers (as higher prices) or its employees (as lowered wages). The whole definition of a government tax is shifting part of the country's productivity to government control, so the government can direct and disburse it as it sees fit. Since only people can generate productivity, only people can pay taxes. Taxing a corporation makes about as much sense as taxing a gumball machine. The gumball machine isn't going to pay the tax. The tax money is going to come from the people who put money into it, and/or the owner who takes the money out of it. Individuals pay all taxes no matter what point in the economy you collect it from.

That's why the Mayor's argument is stupid. The Apple employees who are using Cupertino's public services, roads, and transportation already pay taxes just like every other Cupertino or Santa Clara County or California resident (U.S. property taxes are collected at the county level, sales taxes at the county or state level). Apple can't use those services because it's just a paper entity. Taxing Apple just because they're based in Cupertino is an unfair additional tax on those employees above and beyond what other city residents pay.

Let's take the Mayor's argument to its full conclusion. He probably believes in "no taxation without representation." So if Cupertino successfully taxes Apple on its global profit, Apple will probably end up funding most of Cupertino's budget. Therefore, Apple should get the majority of the representation of Cupertino's government, and they can recall the Mayor and get this tax rescinded (unless they like having control of the city government, in which case they may decide to keep paying to keep control).

This is what's so stupid about this whole "corporations aren't paying their fair share of taxes!" thing. It's hypocritical (unless you also believe corporations should have representation in government). And the taxes just end up being paid by individuals anyway - it's just hidden from you in the form of higher prices and lower wages. That's the reason governments love to tax corporations - because they can increase their tax rate far beyond what the citizens would tolerate, without alerting them that they're being taxed that much. Instead the voters marvel that their "benevolent" government is giving them all these services like health care "for free." It's not free. TANSTAAFL. Someone always has to pay for it by having part of their productivity diverted to the government. Either directly via individual taxes, or indirectly via corporate taxes.

If that rankles your beliefs on who should pay taxes, let's flip it around. Starting tomorrow, there is no more individual income or sales tax. All taxes will be paid for entirely and only by corporations. Sound wonderful? Think again. How do you think those corporations are going to pay for their suddenly increased tax burden? That's right - by raising prices and lowering your wages. The increased prices and your lowered wages will exactly counter the extra money you get by not having to pay taxes, and your purchasing power will be exactly the same as before taxes were shifted

Re:Not funneled into

[Willuz]

Tax havens have absolutely nothing to do with this because the municipality does not charge income tax. It's actually very uncommon for a municipality to charge income tax and most income is from property taxes and sales tax. The tax evasion comments are an unrelated character attack.

Re:Not funneled into

[Anonymous Coward]

I have to question some of your statements (but also agree) on this post:

33%
$189,300 to $411,500
$230,450 to $411,500
$209,850 to $411,500

35%
$411,500 to $413,200
$411,500 to $464,850
$411,500 to $439,000

39.6%
$413,200+
$464,850+
$439,000+

See those numbers above? 2015 tax brackets for Single, Joint and Head of Household. You pay easily into the 33% range? A proper 33% EFFECTIVE rate (I am going to assume single just for the example) will require you to declare a gross income of 661,000. If you are married, filing jointly, then you would need to bring an income of 881,000 for an EFFECTIVE 33% tax rate. Save your "33%" outage for someone else, because unless you are willing to validate it, you are only in a bracket, not effective (I'm in the 28% bracket myself, and I pay no where 28% of my income in Federal taxes because that's how our progressive system works).

Government Spends too much? I agree, blame Congress, they decide the budget and add the pork (I prefer spending bills only talk about one item at a time and no sneaking in other stuff).

I agree on stop giving money to other governments; I'm looking you Israel and others who benefit the most to the tune of billions (that should be for Americans).

You have a very long way to go to get to even close to 50% of your income in taxes; very, very long way to go. Even at the max bracket of 39.6, do you know how high of your income you need to get to that magical 50%? If you're single, you need at least 250 million yearly income to be at 39.58% EFFCTIVE (and the top tax bracket is 39.6%).

Taxes NEVER kills incentive to work harder or hire others. That contradicts your later statements that I will cover. Supply side DOES NOT work, demand for products and services by your middle class is the driver, always has. That will create competition and incentive, MORE BUSINESS, not less taxes. Hiring is based on demands and increased work loads, not "low taxes." That's foolish logic and you know it.

This country was NEVER built on individualism, personal responsibility and growth. One, individualism ... not in the attitude of I, I, I and me, me, me which you are displaying. Personal responsibility? You're one of those Republicans/Tea Partiers/Libertarian types ... personal responsibility is NOT a political platform but an individiual behavior, and that is relative. Growth? Yes, but know how the growth was ... Gilded Age, Slavery, Manifest Destiny, and a hell of a lot less protections for workers, minorties, women, et. al. Save it.

I just want enough government you say? Here is the thing, basic infrastucture and national defense ... that costs money, and your statement of "I want to be free to pursue and along the way you benefit the best you think you can." Here is your error, part of living in society and a 1st world society in that is that you can not have a group of "rugged individualists" running around with that I, I, I or me, me, me attitude. We didn't advance by being a bunch of selfish jerks to every person, we advanced by changing things around us (by laws, or by force, because you know what, sometimes it is necessary even if you don't like it).

You are very free to pursue your happiness, you just want to create an outrage that doesn't exist. The problem is everyone wants to make the claim of "I think I can best decide to do" instead of the government, when in reality you have 300 million more in this country as well and that does not jive. You have to compromise (that is part of being an adult, relenting on things that at times you don't want to).

This is nothing about the Government knows much better than me. I vote for and hopefully elect individuals that has the country and the citizens here in their mind, and to hopefully be selfless in their attitude and behaviors and when deciding policy and budget, spend it on items such as infrastructure, police, fire departments, etc

Re:Not funneled into

[Anonymous Coward]

Sounds good.

I nominate myself for the position!

Re:Not funneled into

[Anonymous Coward]

Oh my god, why hasn't any replied to this? Does no one else understand this? It makes so much damn sense, yet people seem to immediately dismiss the idea of a tax on consumption.

Income tax is legalized theft.

Re:Not funneled into

[mattack2]

Microsoft for instance produces most of its products out of offices in Redmond.

Produces as in someone writes the code in? What if theoretically, they wrote the code in Redmond, but had everything actually compiled in Nevada? Or if the servers for downloads were in Nevada? Seems like there's always going to be ways to "game" the system.

BTW, MS definitely has SF Bay Area offices too, in Mountain View. (There's a weekly SETI institute science talk on a wide range of subjects that's held in a theater in one of the MS buildings.)

Re:Not funneled into

[Anonymous Coward]

Any time you establish rules, people will figure out how to use those rules to their advantage. Money is a self-feeding machine -- the more money you make, the more you can spend on accountants and lawyers to help you figure out how to make and keep more money. (And no sense mentioning that once you have enough money, you can start buying the laws you want anyway.)

So refusing to 'jail' corporations is wrong, saying corporations have more rights is wrong, paying corporations to obey the law is wrong, giving subsidies is wrong, giving welfare for bad behaviour is wrong.

Tax based on profits? OK, we'll figure out a way to keep our books to show no profit. Tax based on sales? OK, we don't sell things, we lease or rent them. Tax based on cash hoard? OK, we'll figure out a way to spend every penny we make.

Great: That creates busy work and reduces the welfare burden. It increases the GDP and the country's lending position. Ultimately, that money is someone's profit, so it will be taxed somewhere; even if it's just sales tax.

Number of employees? Sorry, we only have contractors.

Then make them act like contractors: They don't wear the employer's uniform, the employer doesn't decide when they take holidays, or for how long. Anything else is the government helping the company avoid taxes and workplace liabilities.

Our executives make $1/year, and then we give them stock and benefits.

If it's easily sold, it's income. If it allows the executive to avoid a size-able personal expense (eg rent, motor vehicle purchase), it's income.

Re:Not funneled into

[Anonymous Coward]

... makes foreign companies a competitive advantage ...

Other countries have the same law, which benefits the USA. Worse, US companies get a discounted tax rate, meaning more money going directly to the US government.

Re:Not funneled into

[printman]

Sadly, that's how it works for people but not for corporations (who don't get the foreign income tax credit...)

Re:Not funneled into

[mattack2]

Fix the system, like stealing my money to give to other people?

Re:Not funneled into

[aaarrrgggh]

How do you establish the amount of cash necessary to maintain operations offshore? All Apple needs to say is they are thinking of buying BMW, Tata, Hutchison Whampoa, and/or whomever else, and they have justification for maintaining foreign cash reserves. They also have justification based solely on the value of operations outside the US. By investing pre-tax money overseas companies can become stronger than their "foreign" competitors, enhancing the US.

Reality is the laws are set up to enable commerce, not to maximize revenue. Logically, this should be a better strategy in economic terms, but the system has gotten too skewed by tax havens.

Right that, but don't make it retroactive, and things become much more reasonable.

Re:Not funneled into

[EEPROMS]

eer Apple doesn't pay taxes overseas either because on-line sales internationally are processed via a tax haven sub entity.

Apple should change its design moto from Designed in California to Freeloaded in California.

Re:Not funneled into

[Anonymous Coward]

There should be a law that says "if you have any presence at all in our country, all the money you earn in other countries, and that is taxed in those other countries, should be taxed here too?

Sounds like a stupid law.

No, there should be a law that says "If you make a dollar in the US, you pay taxes on that dollar". This is not being done because of tax evasion schemes that allows corporations to move income using Hollywood style accounting so that money earned in a high tax country (such as the US) appears to have been earned in a country with a low or non-existent corporate tax rate (such as Ireland). While the double Irish sandwich scheme is being phased out by 2020, many other such tax dodge schemes exist.

Re:Not funneled into

[SNRatio]

All of that money is money earned overseas. So it's not "funneled" anywhere, it's just not brought back

Actually, quite a lot of it was earned in the US an other countries with normal tax rates. But Apple, Pharmas, and other companies put their IP in holding companies in countries like Ireland. They then license the IP from the holding companies, paying the holding companies millions of dollars for the right to use their own IP. This converts taxable profits in a high tax country into income in a low tax country.

Re:Not funneled into

[roman_mir]

To answer your question: because there shouldn't be any income taxes or wealth taxes at all, that's why. AFAIC all income and wealth taxes are slavery and that about sums it up. An individual building a company creates value that did not exist before the company existed. The country is based on companies that individuals create, not the other way around, and the entire world is going to learn that lesson this century, after the last few decades were spent destroying savings and thus capital investments by government generating inflation through money printing tax and government growth in general, that requires never ending growing amount of money just to exist.

Companies are finding ways to exit the systems that are trying to enslave them, but those systems were built by those companies. Once the companies exist, those systems will collapse, which is demonstrated in all the bubbles that are blown by government money printing and borrowing operations that truly became more pronounced in the last few decades, once the companies started exiting due to the government legalized slavery became too unbearable while the world becoming more global.

Re:Not funneled into

[Anonymous Coward]

hahaha yeah tell that to Australia, where Apple pays virtually no tax. Thankfully it does seem like our crazy right wing government is actually going to crack down on tax avoidance by Apple, Google et. al. with the strongest tax task force ever in Australian history.

Re:Not funneled into

[psmoot]

There should be a law, the amount owed should be definite, failure to pay would be a crime. That law should apply to everyone, equally.

Agreed. Isn't that the US tax code (modulo exemptions which sound generic but are tailored to apply to only one entity)? I'm not aware of any special provisions just for Apple.

Re:Not funneled into

[Pyrion]

Except the Euro isn't going to improve. Just look at its demographics. Most of the population is nearing retirement, and there isn't an equivalently-sized generation behind it to generate investment nor a generation behind that one to generate growth. The periphery is considerably more screwed, because not only is the Euro too strong for them to generate positive GDP growth on exports, but even if the Euro were artificially devalued ("over our dead bodies," the Germans would say), the periphery's labor market is too old and thus too expensive to employ to compete on straight exports either.

And when that bulge moves into retirement, they stop earning taxable income, and Europe can't afford the bailouts anymore. Not with a hilariously large population base of retirees to pay pensions and medical benefits for, with the tax burden placed on considerably smaller populations. No, Europe as it is right now, is as good as it's gonna be.

Re:Not funneled into

[smallfries]

You mean that an inefficient business would fail?

If they are being kept afloat by a subsidy scheme then a different scheme would keep them in operation under a different tax regime.

Re:Not funneled into

[Anonymous Coward]

The problem with this argument is that if you don't tax corporations on either profit or revenue, then they can just accumulate cash. They don't need to pay out dividends. Shares increase in value since the company has more cash. Shareholders get their return when they sell their shares at a profit. Yes they are taxed at that point, but it's a completely discretionary point. If I'm rich enough I don't need to sell my sales this year, or next year. In fact I can borrow money based on the value of my shares and use that to pay for my life style. This means that the government does not know when it will receive any tax income, or even if it will receive any tax income at all. I don't know about you, but that's going to be tough for running public services, "yeah, I know I need to pay all those cops this month, but I won't get any tax money until Mr Fat Cat decides to sell on his shares in Apple which might never happen."

That's why governments like to tax things like profit or revenue every year, it makes cash flow so much easier.

Re:Not funneled into

[jandersen]

All of that money is money earned overseas. So it's not "funneled" anywhere, it's just not brought back

I think, at the bottom of this debate is the discrepancy between "legal" and "right" - people have a natural, and in my view very legitimate, feeling that the law should not just be clear and well-defined, but also morally right: it should be fair, reasonable and practical, it should be so that when you read it, you think "Yeah, that feels right". A lot of the outrage against not just Apple but all the other trans-national companies has to do with the fact that to them, "right" has been substituted with "legal" - and in fact, "barely legal, by a gnat's whisker". Just like we, the ordinary people, are beginning to be very tired of the way our world seems to be run only for the rich and powerful, we are also beginning to demand that companies do better than covering behind "We didn't do anything illegal" - we want them to be morally and ethically sound, right to the very core. It is a good thing, in my view.

Re:Not funneled into

[Anonymous Coward]

Except that consumption taxes are pretty regressive and can be made discretionary for all but the poorest of the population and is even easier to manipulate for the richest in society. For example. for the poorest: accommodation, food, clothes, transport consumption costs account for the vast majority of their income so they pay a higher percentage burden than almost anyone else in society - is that a fair distribution?

For the middle classes, they can defer when they make discretionary purchases: do you need to buy that 50" TV this year or can it wait until next year, what about that new car? This mean that governments find it hard to plan when they are getting the tax income and that makes it hard when they have known outgoings like cop's pay.

For the wealthy it's worse still, sure they might need to buy a nice mansion, but that's probably once and they keep it in the family for centuries - no new tax income from that. What about that ferrari? well, that's bought offshore where consumption taxes are low but corp tax is higher. Or it's owned by an offshore company and loaned to wealthy individual.

Ultimately this tax approach has a lot of problems. Are they worse than the current system, I don't know without doing a in depth analysis, but it's not as cut and dried as you make it out to be.

Re: Not funneled into

[samwichse]

Ad blocker check ahead.

Fuck Forbes.

Re:Not funneled into

[Whorhay]

I agree that so long as we have states that are free to establish their own tax laws and companies which can freely cross those borders then we're going to have games played. The easiest solution I can think of that might have some semblance of fairness would be a federal law under the interstate commerce clause. That clause would require that corporations divide up their profits across all state and city jurisdictions where they have offices/employees. Use some formula like counting number of employees, contractors, labor costs, and real estate. The point being to simply attribute to each state the profits actually generated from the efforts of it's residents. The formula would undoubtedly be a source of contention and I won't pretend to know what it should look like in whole. But I think such a regulation would improve the state of corporate tax dodging within the USA.

Re:Not funneled into

[jellomizer]

There are a bunch of people who are trying to get into Europe. Once they do they will settle and create jobs. We all just need to get past our racism to realize that.

Re:Not funneled into

[Anonymous Coward]

"spirit of the law"

*snort* you owe me a new keyboard

I cannot tell if this is sarcastic or ignorant.

Re:Not funneled into

[Espectr0]

Most of that money was earned in the US by selling IPhones. Apple is doing nothing illegal, however they are indeed doing everything they can to avoid paying taxes.

Apple has the highest prices in the tech industry and the profits to match, this isn't a secret

Re:Not funneled into

[wyHunter]

It doesn't mean it isn't in dollars in offshore banks.

Re:Not funneled into

[wyHunter]

But none of their worldwide money is repatriated - which encourages offshoring of work from the US. What else will they do with their money?

Re:Not funneled into

[Anonymous Coward]

"If the corporations paid the same effective rate as they paid under Ronald Reagan individual tax payers will get an immense tax relief. We can take our personal income tax rates from 36.3% top rate down to 20% top rate or even a flat tax of 15%."

You are incorrect. Consider: The corporate income tax rate is 35% and accounts for 5% of GDP. The individual income tax is 25% and accounts for 40% of GDP. If you increase the corporate tax rate by 100% (from 35% to 70%) you get an additional 5% GDP... which would offset reducing personal income tax by 12.5% (from 24% to 21%). To get to a 15% flat income tax you'd have to increase the corporate tax rate 400% (from 35% to 140%). It should be self-evident that a 140% corporate tax rate is not sustainable.

The problem is NOT insufficient government income. The problem is excessive government spending. The US has a the highest corporate tax rate in the world at 35%. Ireland has a 12.5% rate. Is it any surprise we aren't competitive?

Re:Not funneled into

[Anonymous Coward]

You're being dense. Take a company that makes $500,000 profit off of $10,000,000 in revenue:

1. If you tax profits they pay $175,000 in taxes and are left with $325,000 profit.
2. If you tax revenues they pay $3,500,000 in taxes and are left with -$3,000,000 profit.

If you don't understand why taxing revenues is a problem you're an idiot.

Re:Not funneled into

[Anonymous Coward]

Tax based on cash hoard? OK, we'll figure out a way to spend every penny we make.

You've just described the actual purpose of corporate taxes, congratulations. The reason they tax profit and not revenue is that the taxes are supposed to act as an incentive to the company to spend more of their revenue, because spending is what keeps the economy going.

Re: Not funneled into

[Anonymous Coward]

No they aren't. It's shell companies all the way down.

Who keeps thinking they are paying fair share in any country?

Re: Not funneled into

[Anonymous Coward]

Because that's how it works?

If my company sold a widget, regardless of where its shipped, that's profit made by the company. The same "company" setup in a tax haven makes that same sale, it's just fucking paper differences.

Re:Not funneled into

[toddestan]

What a bunch of utter nonsense.

So of course corporate taxes are paid for by its customers (as higher prices) or its employees (as lowered wages).

Funny how you left out the third group. The owners of the company, better known as the shareholders. Oh wait, that's Wall Street. The 1%. Nope, can't tax them. I mean, ask yourself, who owns the land and buildings in Cupertino where Apple's HQ is? Apple's employees? Does Joe Programmer own his cube? Really? No. Apple's customers? Hell no. How about the billions in the bank? Do the employees own that? NOPE. The customers? Well, that's their money... well... more like WAS their money. All of Apple's IP and trademarks? Those are owned by the employees right? No again. The customers? Ahhhh... nope.

Lower taxes on corporations results in higher profits which would go straight into the owners of Apple, at a tax rate lower than what I pay. The rich will get richer, and like usual the burden would be dumped on what's left of the middle class. I get taxed on the property I own, so why should the shareholders be any different? They can pay their fair share too.

Re:Not funneled into

[smallfries]

If the corporate tax rate on revenues is set at 35%. Of course in real life the percentage can changed, e.g. 1.75% of revenues.

Re:Not funneled into

[Amanitin]

Any time you establish rules, people will figure out how to use those rules to their advantage.

that is why we need to have simple rules. You cannot game 2+2=4. Of course the federal tax code is 75 thousand pages for that very reason. So it can be gamed by those who have the means.

Tax based on profits? Tax based on sales? Tax based on cash hoard?

No. No. No.

Tax the corporations based on gross income. You know, just like you and I are. Very easy to track and audit. With the same tax rate for corporations and people.

Re: Not funneled into

[Karlt1]

So even if Apple paid all of the taxes that they "should" pay, how would that help Cupertino? The only taxes that companies pay to cities are property taxes. I'm sure Apple has to pay that. All of the other taxes are paid by employees.

Re: Not funneled into

[Karlt1]

How are shareholders "they"? Apple is a publicly traded company. Anyone can buy shares either directly or through mutual funds.

Re:Not funneled into

[Anonymous Coward]

Imagine a lumberjack, a carpenter, and someone owning a furniture shop. Each week the lumberjack sells $100 worth of wood to the carpenter. Each week the carpenter turns that $100 worth of wood into $200 worth of furniture, and sells it to the furniture shop. The furniture shop then sells it for $300. Imagine the three people all need $80 per week to pay for expenses, so they all have a profit of $20 per week. Let's assume they are taxed on this profit at 20%. These three people combined produce $300 worth of goods per week, at a combined profit of $60, and $12 of that is paid in taxes.

Now let's assume a tax on income instead of profit. What should the percentage be? I'll start with 10% for simplicity.

The lumberjack has an income of $100, after taxes and expenses he has $90 left and a profit of $10.
The carpenter has an income of $200, after taxes and expenses he has $80 left and no profit.
The furniture shop has an income of $300, after taxes and expenses hes has $70 left and a loss of $10.

Okay, so now all three are out of a job because the carpenter and furniture shop are no longer profitable, and the lumberjack has nobody that's buying wood.

The megacorp McFurniture comes along and buys the lumberjack, the carpenter, and the furniture shop (cheaply, because they were running at a loss). The corporation employs the lumberjack, the carpenter, and the salesman for $85 per week.

McFurniture has an income of $300, after taxes and expenses it has a profit of $15.

It's magic! Thanks to your proposed tax scheme corporations that own their entire supply chain have a tax advantage over those that do not. The longer the supply chain the more extreme this advantage becomes, because each separate entity in the chain is taxed.

Of course my 20% and 10% taxes aren't realistic. But consider this: in a properly functioning free market with plenty of competition, the profit of corporations approaches zero (because with plenty of competition it's a race to the bottom). So let's simplify to the point of spherical cows and say corporations never run a profit, they only ever break even. In such a market collected profit tax for corporations is $0 regardless of the tax rate. Once we adopt your income tax of, say, X%, the price of all products must increase by a factor (1 + (X/100))^N, where N is the length of the supply chain. It's exponentially terrible for small businesses.

Re:Not funneled into

[indi0144]

Youre more likely to repeat the 100 year cycle of "hey, everything is kind of fine, let fuck up the equilibrium for shits and giggles and bleed for 10 years or so another country far away can profit and get out of it like an empire" than to "get pass your racism." And those people trying to enter Europe, most, are not planning on staying, for them Europe does not represent a massive improvement in quality of life (compared to what a subsaharan immigrant might get) but not that much to have to put up with your xenophobe side, if Germany of all places is showing it...

On the other hand, kudos to London for electing a Muslim mayor, if he turns roge they might justify mass deportations, because we know you want to.

Disclaimer, I have no pony in this show, not even in the same hemisphere, it's just how it looks from here.

Re:Not funneled into

[smallfries]

Good point. Thanks for the well explained example. I feel that I may have just been schooled on some aspect of economics 101 :) certainly I learned something interesting today - thanks for that.

Re:Not funneled into

[RyoShin]

Tax based on cash hoard? OK, we'll figure out a way to spend every penny we make.

This seems like a good thing. Sure, it hurts the gov. debt, but forcing them to spend all the money instead of sitting on it means the money moves around the economy (even if they use it on "business expenses" like diamond-studded yachts), which increases taxes from other venues slightly.

Even if it's spent overseas, there's still a little benefit to US citizens by way of any US manufacturing/service that increases from that extra circulation of money.

Re: Not funneled into

[Anonymous Coward]

Apple is already the top taxpayer in [...] the whole fucking country!

Then why does Forbes list Exxon and Chevron as paying more tax? http://www.forbes.com/pictures...

Because that list is 3 years old? Which means the taxes paid in 2012, which based on the net income from 2011.

Where Earned

[Luthair]

Really taxes should be paid in the country/locale where the money is earned, not the HQ (or a post office box somewhere). Otherwise these large multinationals will continue to be parasites on countries around the globe.

Re:Where Earned

[Anonymous Coward]

Like a sales tax on goods and services? I already paid those for my iProds and ISP service.

Re:Where Earned

[jratcliffe]

Agreed, except this isn't how US corporate income taxes work. The reason Apple has all that cash parked overseas is that the US wants to tax Apple profits on products sold everywhere, not just in the US.

Even if we made the change to the US tax system that you suggest (move to a where earned from a HQ model), corporate taxation would still be a complex topic. If Apple sells an iPhone in Germany, it should pay taxes in Germany on that profit. But how much profit was really generated there? What's the "right" cost of that iPhone to Apple's German subsidiary?

Re: Where Earned

[Anonymous Coward]

Taxation is theft.

Re:Where Earned

[AK Marc]

Originally, the tax location for a corporation was where the offices of the CEO were (not explicitly, but in practice). A large English trading company was treated like all sales were made at the corporate HQ. Of course, back then, the taxes were also structured differently.

If Apple sells an iPhone in Germany, it should pay taxes in Germany on that profit. But how much profit was really generated there? What's the "right" cost of that iPhone to Apple's German subsidiary?

I think the general agreement is that there is no easy answer to that, but that the current answer is "Not Fucking Ireland".

Re:Where Earned

[Anonymous Coward]

Really taxes should be paid in the country/locale where the money is earned, not the HQ (or a post office box somewhere).

Okay, Apple products are designed/engineered in Cupertino. The physical products are manufactured in China. So for example, for Apple products sold in Europe, how should the taxes/profits be divided among these three continents/countries?

No country seems to investigating and analyzing this problem. They just want the biggest piece of the pie (tax).

Re: Where Earned

[Anonymous Coward]

Posted like a true poor person. You are probably clueless as to how much you benefit from the institution of taxation, and just how much you would actually give up to live in a world without it.

Re:Where Earned

[FlyHelicopters]

Originally, the tax location for a corporation was where the offices of the CEO were (not explicitly, but in practice). A large English trading company was treated like all sales were made at the corporate HQ. Of course, back then, the taxes were also structured differently.

Yes, but that was back when the sun never set on the British Empire and England controlled 1/4 of the planet.

They could get away with that back then.

Today, it is America trying to do it (worldwide taxes), but America is trying to do it without... Empire...

It is a crappy half-assed solution that needs to go away.

Re:Where Earned

[AK Marc]

Yes. But the problem is that the US is an empire. The US enforces local laws globally, and interferes in internal matters routinely. The budget of the US enforces US IP globally. So they get the benefits of a global empire, but don't pay into it. That's the problem. The US should not be the world's enforcement (certainly not for the US companies that don't pay their share of tax). Yes, I realize that Apple pays lots, but still not their share.

Re:Where Earned

[Luthair]

The current system was setup eons ago when the expectation was that they'd be paying taxes elsewhere. Even were that the case it wouldn't be a great solution as these large dominant companies would still be taking advantage of the country and only taking money out without contributing back. There are jurisdictions that operate on territorial taxes.

Re:Where Earned

[Luthair]

The profit originates where the item was purchased. Note profit, not income. Obviously licensing a patent to yourself is not a cost.

Re:Where Earned

[FlyHelicopters]

The US kinda sorta wants an Empire, without the emotional baggage that comes along with it...

Either do it all the way, or don't... this half-way solution is stupid...

Note: I'm not supporting either position, I'm simply saying that in this case, the middle isn't the place to be.

Either go full-on British Empire and control 1/4 of the planet, or don't. But don't try and run the place without owning it.

Re:Where Earned

[Anonymous Coward]

Yes, but that was back when the sun never set on the British Empire and England controlled 1/4 of the planet.

They could get away with that back then.

LOL, the British (and before that the English) had multiple and numerous tax revolts over the years, as well as manipulations by various powers, from the Baron's Revolt to the East India Tea Company.

You think Robin Hood was the problem?

Not hardly. Just popular stories.

But Jack Banker, he was another story.

Re:Where Earned

[martinfb]

Taxes need to be paid WHEREVER an entity uses public infrastructure. If my biz in in Cupertino, I should be paying whatever taxes Cupertino needs. Otherwise, I am not rightfully entitled to the benefits from those tax dollars. If you want Cupertino police to protect your facility, then pay for it. If you want the US military to defend you, then PAY FOR IT!

Dealing with the devil

[OzPeter]

Hmmm .. from Apple's new headquarters gains approval of Cupertino City Council back in 2013

The Cupertino City Council voted unanimously Tuesday to reduce the annual tax break it gives Apple (AAPL) -- America's most valuable company by market capitalization, with a net income last year of $41.7 billion -- by 15 percent. Having wrung that concession from its richest corporate resident, the council then voted unanimously to give its final blessing to Apple's proposed new headquarters. The spaceship-shaped building has now officially landed.

Back in 1997, when Apple was on the verge of collapse, the city agreed to return 50 percent of the taxes generated each year from Apple's business-to-business sales as a way to help maintain the company's health and, more importantly, its Cupertino address.

Sounds like someone made a deal with the devil and now has a bit of buyers remorse.

Re:Dealing with the devil

[Altus]

Seems pretty reasonable to drop that exemption now that apple is doing find and has invested in a new headquarters in your town. I can understand why they gave the exemption in the first place, apple being there meant rich engineers and managers living in the town paying taxes and you didnt want to lose them, but now, they are strong and aren't going anywhere.

Also, how can Cupertino be broke, I would imagine property taxes there would be through the roof, housing prices certainly are.

Re:Dealing with the devil

[jcr]

how can Cupertino be broke

No matter how much money any government receives in taxes, they will always spend more and borrow whatever they can get away with.

-jcr

Re:Dealing with the devil

[SvnLyrBrto]

> Also, how can Cupertino be broke, I would imagine
> property taxes there would be through the roof,
> housing prices certainly are.

Prop 13.

The baby boomers decided a long time ago that they would rather take a few extra vacations every year than fund the schools and infrastructure that would enable the following generations to enjoy the same level of wealth that they were handed by the WW2 generation.

Re:Dealing with the devil

[Anonymous Coward]

No, Cupertino has grown massively, its tax base has been suffering (especially as Apple keeps buying up more corporate real estate). They can't even afford to build new public schools.

They aren't just blowing money... And a kneejerk ideological BS statement isn't an answer. Feel free to go through their budget line by line and see if you can find things to cut. But no! government spends too much money. Go ahead and try with discretionary spending in the federal government. You won't get that far either.

Re:Dealing with the devil

[jittles]

> Also, how can Cupertino be broke, I would imagine > property taxes there would be through the roof, > housing prices certainly are.

Prop 13.

The baby boomers decided a long time ago that they would rather take a few extra vacations every year than fund the schools and infrastructure that would enable the following generations to enjoy the same level of wealth that they were handed by the WW2 generation.

Oh please. Prop 13 encourages people to stay in the same place a long time. You don't get to transfer your prop 13 tax rate unless you qualify for social security. How many people stay in the same house for 30+ years? If you want to upgrade, your property tax goes up just like everyone else. Prop 13 keeps people who have lived in California (and especially the Bay Area) a long time from having to relocate because people seem to think they've got money to burn in the bay area these days. I don't think it's unreasonable to protect the elderly from skyrocketing property tax. And yes I used to own a house in California and was on the negative end of prop 13 myself.

Re:Dealing with the devil

[Anonymous Coward]

No matter how much money any government receives in taxes, they will always spend more and borrow whatever they can get away with.

Actually, this is historically not true. The fact that you got marked insightful is a measure of how politically astroturfed this site is; facts aren't important to ideologues.

People who claim otherwise are usually trying to justify the corruption and incompetence of their own leadership. It's a way of saying "They're all like that, so my hero worship of Reagan or Obama is legitimate!" But in the fact-driven world, nope, they aren't all like that.

Re:Dealing with the devil

[Anonymous Coward]

How many people stay in the same house for 30+ years?

A hell of a lot of Californians, specifically because of Prop 13. No re-assessment takes place if the property isn't on the open market, so you get a lot of 'families' holding onto old housing stock with rock-bottom property taxes.

So yeah, fuck Reagan, and fuck Prop 13.

Re:Dealing with the devil

[MerlynEmrys67]

They can't even afford to build new public schools.

So, first off - the school district isn't "owned" by the city council. As far as I know - the city doesn't pay a dime for the schools here, it is all funded by a block of money from the state from property taxes that is used to pay for the school system.
Second off - the Cupertino schools consistently rank as the top high schools in California. To say that there is a lack of funding would be a travesty. The schools appear to be adequately funded and staffed with a superior outcome.
Third - if the schools needed operational money, that is very different than needing capital money to build a new school. Frankly - poking around in Cupertino, I am not sure there is a suitably large property that could be bought and developed into a school. So that leaves us with expanding existing campuses. My daughter's school just had a new building added 2 years ago - cafeteria, physics classrooms, etc. that was needed. This was simply budgeted and spent. I believe the other high schools have similar programs to build classroom space as it is needed.
So in conclusion - that statement doesn't apply. The schools are great here, please don't imply it is apple's fault that the schools are so great

Re:Dealing with the devil

[sconeu]

Reagan had zero to do with Prop 13. Prop 13 passed in '78. Jerry Brown was Governor and had been since '73. Reagan was not holding any office at the time.

Prop 13 came about because of Howard Jarvis and Paul Gann.

And yes, people WERE being forced out of their homes at the time because property taxes kept getting jacked. That's why there was a competing proposal (Prop 8) on the same ballot.

Re:Dealing with the devil

[Anonymous Coward]

They aren't just blowing money...

That's exactly what they're doing you stupid cuck. Go back to smoking bowls and worshipping your Bernie wood carving.

Re:Dealing with the devil

[Anonymous Coward]

Ah, you must be a Drumpf fan. Explains your single digit IQ.

Re:Dealing with the devil

[Moof123]

Same happens all over.

Here in Oregon we recently saw Intel flex there muscle to get special tax breaks for a major fab expansion. Nike is surrounded by the city of Beaverton, but uses threats to leave to prevent annexation that would make them pay the same property taxes that all their neighbors do.

Major employers can use blackmail to get major concessions. Hell, Boeing got concessions a few years back up in Washington and moved much of the operation anyway.

Basically once a business gets big enough it can throw its weight around and get into a tax exempt club. It is anti-competitive, but it works, and is legal. Employees are used as a bargaining chip. Tax exempt us or all our employees will vanish and stop paying taxes. Such behavior is despicable and should be illegal under the equal protection clause, but what do I know.

Re:Dealing with the devil

[Moof123]

Oregon got it a little more right. Property taxes are throttled to 3% per year (should have been a little higher) to prevent wild swings in property taxes, but they are throttled to the original house price (or 1995 valuation, whichever is more recent). It keeps things a little more sane.

Re:Dealing with the devil

[Anonymous Coward]

Whoa whoa whoa! That IQ is at least room temperature!

Re:Dealing with the devil

[jcr]

the Cupertino schools consistently rank as the top high schools in California

That's based on student performance, which is skewed upwards by the Chinese kids whose parents send them to private cram schools in addition to their public school hours.

-jcr

Re:Dealing with the devil

[jcr]

They aren't just blowing money.

Bullshit. I get mail every fucking week or so advertising city recreational programs and other frills that I never asked for.

-jcr

Re:Dealing with the devil

[Anonymous Coward]

Exactly.

What most people never learn is that government spends most of the tax on giving itself massive salaries and pensions. Work for 30 yrs and retire with a massive pension + benefits. Likes of which most working class people will never see.

Yet the fools we are, we keep pushing for higher taxes.

Re:Dealing with the devil

[KozmoStevnNaut]

Fahrenheit or celsius?

Re:Dealing with the devil

[MikeBabcock]

They probably have a similar infrastructure problem as Redmond (Microsoft home base); the huge employer they want to keep also costs them a boat-load in infrastructure.

cf http://crosscut.com/2008/02/mi...

Just a matter of time

[angel'o'sphere]

Companies like Apple or Facebook that are basically IP and IT driven will soon anyway found their own "countries" on floating islands.

Tax their products ... not their money/earnings, that is much easier.

Re:Just a matter of time

[pnutjam]

Yeah, and checks are going away in the US...
You crazy kids...

Don't be evil

[jfdavis668]

Oh, wait, that's Google. Nevermind.

Ireland

[Anonymous Coward]

Ireland, meanwhile, hasn't seen so much money in a century. Thanks Apple, Google, et al! We're growing a lot of new potatoes here now.

Corporate Handouts

[Anonymous Coward]

He's doing it wrong. Ask for handouts like they have in San Fancisco.

want your cut?

[supernova87a]

So, just because a business that is successful sits within your small jurisdiction, you're entitled to a cut of taxes from everything that they produce worldwide? That's a pretty expansive argument.

I would be in support of Apple paying its rightful share of all the taxes needed to support the city infrastructure and government that it burdens. Not much more. Sounds like these councilmembers want the "more".

Re:want your cut?

[110010001000]

Yes. That is how taxation works. You pay local, state and Federal tax don't you? Are you stupid?

Re:want your cut?

[bluefoxlucid]

They seem to forget that corporate taxes are tiny.

Apple's money winds up funneled to Chinese workers, support reps, Apple Store retail employees, shipping companies, advertisers, and the like. All of the things involved in Apple's product sales are costs representing human labor time; each individual business supplying said product or service has its own price, higher than the cost. You aggregate them and you get a gap between cost and price, with an aggregate cost paid out as wages on labor and an aggregate price equal to the price of the thing sold.

Apple's Cupertino HQ shuttles some of that cost to its 12,000 staff (the new campus will house over 13,000) each making around $120,000-$150,000 (median in all of Cupertino is $127,000 per household; Apple INTERNS make $80,000, HW engineers make $130,000, SR HW $160,000, etc.). Cupertino is an economic shithole with an 8.75% sales tax rate and a 6% income tax rate (sales taxes are inefficient and have the same impact as raising cost by a percentage of the *price*, which reduces consumer buying power and thus the available jobs).

That means Apple brings $2 billion to the Cupertino economy through WAGES, minus Federal taxes (~30%), leaving $120 million of income tax income via wages and some slightly smaller amount (sales tax is spotty) through sales tax, plus Apple's corporate taxes. That's out of Apple's $33.25 billion operating expenses: Apple expends 6% of its operating expenses in Cupertino.

Cupertino wants a chunk of Apple's sales from all over the world. They want to come up behind Apple and claim rights to a chunk of everything that's left over. This isn't an unreasonable proposition or a bad policy (taxes on business income are far less damaging to the economy than taxes on business activity: payroll taxes raise the cost of trying and thus the *cost* and corresponding risk of failure, while income taxes on business raise the cost of *success* by a portion of that success). It's also not explicitly reasonable or good; it's mostly a policy of opportunity: finance by association.

You can have any number of moral arguments for or against, and most of the moral arguments are essentially the same argument as the desired output. To put it another way: Cupertino essentially complains that Apple does all this business all over the world and *Denmark* profits because Apple files its profits in Denmark; instead, Cupertino wants to relocate Apple's tax burden to Cupertino, drawing profit to Cupertino. How is this different than relocating its tax HQ to Baltimore, India, or some other locale? If Apple is making all this profit on income taken from residents of other cities and countries, should it not pay its income taxes there instead?

Economically, those arguments get into protectionism, which actively harms your economy (taxing the export is a disadvantage); and you can also argue that local products pay said taxes, and so taxation at fair rates is not penalization (your local suppliers already pay a tax, and the importers are only paying the *same* tax and not an *import* tax). This is one of the only sensible arguments of sales tax proponents (see my earlier comments about sales tax; the extent of flaws is not limited there).

With a net income of $10 billion, an operating expense of $33.25 billion, and $2 billion paid to operate in Cupertino (wages), it seems only 6% of Apple's operations occur in Cupertino. Maybe they owe taxes on $600,000,000--about $90 million? If we account for Apple's global sales versus their Cupertino sales (income generated from the Cupertino market), maybe they owe Cupertino a shitload less than that. Maybe Cupertino should consider the ~$200,000,000 in tax revenue and $2 billion of wage spending flowing to them from *the entire world* as Apple's contribution, instead of trying to position themselves as a parasite on every other city in the entire iPhone-using world.

Re:want your cut?

[psmoot]

I would be in support of Apple paying its rightful share of all the taxes needed to support the city infrastructure and government that it burdens. Not much more. Sounds like these councilmembers want the "more".

Question is, what's the "rightful" share. I thought we generally used property taxes for that, not corporate sales taxes. So, Apple's rightful share would be the property tax on all its extensive real estate in Cupertino.

It also sounds like Cupertino gave Apple a property tax break to keep them in town. OK, fine, admit that's what you did, take responsibility for the consequences, and talk about whether you want to re-negotiate. But don't whine about how you want a slice of Apple's accumulated profits, that was never in the cards. And use this as an object lesson about why you might not want to do that in the future.

Re: want your cut?

[Anonymous Coward]

Relatively few Apple employees reside in Cupertino. So most of those rich salary dollars you cite leave the city immediately and don't return.

Force them to pay

[Anonymous Coward]

Write up a law that forces any company that makes more than 100 million$ to give 15% of their profits to the city or cities they have employees in. Very simple, if they don't give the money you have to take it by law.

Re:Force them to pay

[Anonymous Coward]

So adding up federal, state, and your soak them because they are successful tax, they fork over 60%. Then their dividends are taxed again at the individual level at 10-20%? That's all on top of the property tax they pay for the facilities/capital that their employees use. If I ran a business in that climate, I'd move it somewhere else.

Just because they have money

[gregersonke]

Yea, they have money, and they have a responsibility to their investors. They also brought a ton of money into the city simply through sheer number of jobs created in the local city. Should they get tax breaks? Yes. Should they pay taxes. not more than anyone else in the city.

Re:Just because they have money

[Anonymous Coward]

If you open a large company in Redmond (for example), and most of your employees live in Seattle and commute across the bridge, your employees' property taxes in Seattle aren't going to do a whole lot of good to support the new infrastructure required in Redmond.

Re:Just because they have money

[Moof123]

My taxes are my responsibility. I pay them. My employer should pay theirs.

When one class of tax payers get a free ride, the rest of us who don't have a fleet of lawyers and politicians on speed dial end up picking up the slack.

An open letter to Mayor Chang of Cupertino

[Marginal Coward]

Dear Mayor Chang,

What part of "building permit" and "property taxes" don't you understand? If you folks let Apple build a giant doughnut in Cupertino without the city collecting adequate local taxes on it, you can hardly blame us, can you...?

your friend,

Tim Cook

Re:An open letter to Mayor Chang of Cupertino

[Anonymous Coward]

True that. But he addressed this in the story: the rest of the local governance is either in Apples pocket or too afraid to act.

We have this problem in Portland. Rents doubling, sometime tripling in a year. People paying cash for 1/2 million dollar starter homes. Yet, the roads have so many potholes it's unsafe to drive in many places. There are now tent cities of homeless. It's worse in Portland than it was in NYC in the 80's. Whatever happens next, it's going to be ugly. Someone has been setting fire to the homeless camps. I suspect the people burned out of those might decide to try the same thing on those expensive condos. Fun times, to be sure.

Re:An open letter to Mayor Chang of Cupertino

[Anonymous Coward]

Exactly. I remember the Cupertino city council meetings when Jobs showed up asking for approval for the building. However, he threatened that Apple would move its entire operations if the project wasn't approved. I know San Jose was licking its chops at that idea since they have been trying to get Apple to move its corporate headquarters for years. I guess San Jose is used to being fucked in the ass without any lube. Other companies would have occupied the buildings vacated by Apple since Silicon Valley has an extremely low vacancy rate for commercial property. Anyways, the council members were humble that their city was blessed with Apple and they approved the messiah's temple.

Same thing happened in Santa Clara regarding the stadium. The city pledged no general or utility funds would be used and they lied. The 49ers said they would finance the construction and they lied. Both said they were not interested in moving the youth soccer fields and they lied.

Re:An open letter to Mayor Chang of Cupertino

[__aaclcg7560]

I know San Jose was licking its chops at that idea since they have been trying to get Apple to move its corporate headquarters for years.

Fast forward several years later, Apple is bringing 4.15-million square feet of office space to North San Jose over the next 15 years. In comparison, the Apple HQ in Cupertino is only 2.8-million square feet.

http://www.sfgate.com/business/article/Apple-gets-green-light-for-massive-San-Jose-6786465.php

big wheel keep on turnin

[Pseudonymous Powers]

City Government: Please come to our city, Big Business! We'll give you incredible tax breaks! We'll practically pay you just for existing here!

Big Business: I don't know. That "practically" sounds kind of hesitant. Besides, there's a bunch of other towns down the road that might offer us a better deal.

City Government: Fine, we will literally pay to just to keep your corporate headquarters here. We'll give you the land for a pittance. We'll fast-track the permitting process. We'll give you a zoning variance. None of the city ordinances will apply to you. And no direct taxes on you, we promise. We'll make it up by taxing our citizens, who will probably mostly be working for you from here on out.

Citizen: Hold on. I was busy with my life just then, but it sounds like you're going to let some huge company move in and take over, and use my taxes to build a new thirty-story corporate headquarters in my front yard, and then crank up my taxes even more to make up for the taxes you spent on them?

City Government: Yes, but you'll be able to afford it, because you can get a good job at the company!

Citizen: I like my job now. I don't want to fucking work for those fuckers. I don't want a bunch of douches coming in and putting in 17 Starbuckses on the same street and making us all have to sort our garbage into eight separate bins and raising the rents to ridiculous levels so we have to all move out.

City Government: We hear your concerns. But we really want more tax money to play with. So, fuck you. Leave town if you want. Don't let the screen door hit you on the way out.

[Decades later.]

City Government: Hey, Big Business, uh, while our tax revenue has been growing continuously for decades now, it turns out that our expenditures have been growing even faster, because it turns out that a lot of money is not infinite money. We need infinite money. All our planning is based on infinite money. You need to give us more money. That'll get us closer to infinite money.

Big Business: Fuck you. Learn to do math, assholes.

City Government: I'm afraid we really must insist. We're going to raise your taxes.

Big Business: Then I guess we'll just move down the road to the next city. See you later.

City Government: But... but... you can't!

[But it turns out they can. Return to top and start again.]

Re:Fuck you, Barry Chang.

[ArchieBunker]

Lotta fanboys out today.

Close the roads and utilities

[Culture20]

Close the roads and utilities, then. Not just to Apple campus, but to all Apple employee neighborhoods. Watch all the Apple employee income tax and sales tax flee your area. You'll probably still get he property taxes, but they'll reduce across the board.

Where do local city revenues come from?

[magarity]

So all those high paid Apple employees don't pay property taxes on their homes in the area? They don't pay sales taxes on the stuff they buy around town?
How does a local city government think it is entitled to tax revenue earned on sales in (other country) after the company already paid (other country) income taxes?

Re:Where do local city revenues come from?

[gregersonke]

Cupertino is pretty small, and the number of actual stores in cupertino is pretty low. You would think they'd promote more apple buying within the city.

Re:Where do local city revenues come from?

[CanadianMacFan]

Maybe the local city government thinks it works for the federal government so why not give it a go?

Re:Where do local city revenues come from?

[__aaclcg7560]

The only shopping mall that they have in Cupertino has no stores, unable to compete with other shopping malls in the region. No stores = no sales tax. The newest proposal is to convert the shopping mall into a mix development of shops and housing. With the new Apple HQ down the street, it makes sense to throw in more housing. However, less sales tax.

http://www.mercurynews.com/cupertino/ci_29822286/vallco-mall-empties-out-tenants-begin-settle-elsewhere

Re:Where do local city revenues come from?

[PCM2]

So all those high paid Apple employees don't pay property taxes on their homes in the area?

"In the area" doesn't necessarily mean the City of Cupertino. Lots of Apple employees live in San Francisco, for example, which is in an entirely different county than Cupertino. And in fact, Apple employs more people in the US than the entire population of Cupertino.

Re:Where do local city revenues come from?

[Anonymous Coward]

Because the game that's played everywhere consists of stealing everybody else's money.

TAXATION IS THEFT!!!1!!!

[Thud457]

We should just abolish all taxes and fund government services Al LeCarte on Kickstarter.
Find out what really matters to who.

Re:TAXATION IS THEFT!!!1!!!

[Anonymous Coward]

Al LeCarte... a reactionary Parisian anti-Islamic-terrorist group?

Re:TAXATION IS THEFT!!!1!!!

[AK Marc]

Thank using roads without paying for them is theft.

Its your own fault

[Anonymous Coward]

If you were not trying to destroy companies with overbearing tax rates they wouldn't need to use LEGAL routes to reduce the burden. But go ahead, instead of learning from your mistakes, raise tax rates even more, then wonder why they left town totally.

Re:Its your own fault

[__aaclcg7560]

If you were not trying to destroy companies with overbearing tax rates they wouldn't need to use LEGAL routes to reduce the burden.

Never mind that corporations paid a 90% tax rate in the 1950's.

Re:Its your own fault

[RatherBeAnonymous]

Huh? The top individual tax rate in the 50's was 91%, not corporate. The top corporate rate was around 50%.

Re:Its your own fault

[Anonymous Coward]

No one paid that rate. Too many loopholes to take advantage of. Effective tax rates have remained more or less the same since the 50's.

Re:Its your own fault

[__aaclcg7560]

The top individual tax rate in the 50's was 91%, not corporate. The top corporate rate was around 50%.

You're correct. I get the two confused sometimes.

http://federal-tax-rates.insidegov.com/l/35/1950

Re:Its your own fault

[Anonymous Coward]

Please try not to be blatantly retarded.

Re:Its your own fault

[Anonymous Coward]

and notice how development skyrocketed in the 80s as taxes fell???

Re:Its your own fault

[__aaclcg7560]

and notice how development skyrocketed in the 80s as taxes fell???

See how the middle class shrunk, real wages stayed stagnant and infrastructure fell apart?

taxes on holdings?

[Anonymous Coward]

I'm no apple fanboy - but seriously, taxes on holdings, personal and corporate pretty much anywhere in the world are zero. Their nest egg is irrelevant to taxation.

Re:taxes on holdings?

[RatherBeAnonymous]

The 180+ billion dollars we are talking about are corporate profits that have basically never been taxed. Some of this represents profits generated in other countries, but much of it was profits from the US that was moved off shore. Apple sells intellectual property to subsidiaries in tax havens for a low price, then leases the technology back to its US based divisions at high prices. The books for the US based entities therefore show low profit and are barely taxed, even though Apple, as a whole, is raking it in.

Yeah, but your rents are through the ROOF!

[Anonymous Coward]

So that makes it okay. Were you expecting also your chicks for free?

Thou will take what Father Steve giveth

[NotDrWho]

And thou will not complain!

Civic greed

[mveloso]

We want all your money, and we want it now!

- your government

Oh, FFS.

[fyngyrz]

This is not Apple's fault. This is congress's fault. Period.

Vote accordingly.

Re:Oh, FFS.

[ShanghaiBill]

Vote accordingly.

Vote for whom? Everybody knows that America's system of corporate tax is totally dysfunctional. We have the highest corporate taxes in the world, yet collect very little because of all the loopholes. We give companies a huge incentive to create jobs anywhere but in America. Both parties recognize this problem, and there are plenty of proposals to fix it. But they all get caught up in the political gridlock, so nothing changes.

Re:Oh, FFS.

[Anonymous Coward]

Bingo. Apple expects a big return on all that lobbying money they've been spending in DC.

Re:Oh, FFS.

[Captain Splendid]

So regulatory capture isn't a thing then? I mean, if isn't, then fine. If it is, you're blaming the victim, not the rapist.

Re:Oh, FFS.

[Anonymous Coward]

Vote for whom?

"America will compete with the world and win by cutting the corporate tax rate to 15%, taking our rate from one of the worst to one of the best." - Trump

Re:Oh, FFS.

[cayenne8]

"America will compete with the world and win by cutting the corporate tax rate to 15%, taking our rate from one of the worst to one of the best."

Hey, it makes sense.I don't know if 15% is the magic number, but I'm thinking it is likely in that ballpark....

However, if nothing else...you can NOT blame a company or a person, for taking advantage of every legal tax law to save as much of their hard earned money from the tax man.

I mean, do everyone one of ya'll, take every deduction you possibly can, or do you happily give more than you would owe if you took advantage of all deductions you could that are available to you?

I tend to doubt everyone is as altruistic as they think other folks/companies should be....

If you don't like how things are done, then do AWAY with the old tax code.

Make it simple for companies.

You make $x. Your expenses for the year were $y. You owe z% of ($x - $y). Bang...dead simple, no huge inflated tax rates that are just bypassed by loopholes/deductions. Company spends MUCH less on accountants. And Federal Govt has much less control over the citizens. This is especially true if you (as I assume) are also simplifying the tax code for individuals too.

If you don't like tax loopholes/deductions...then get rid of them all.....and simplify the laws. And quit trying to use taxation as a way to manipulate behavior...last I looked, that was NOT one of the few Constitutionally enumerated responsibilities and powers of the Feds.

They need to tax to get revenues to serve the populace, period. Nothing more.

Re:Oh, FFS.

[Anonymous Coward]

You really think that z% of $x - $y is dead simple? You wish.

Google "Hollywood Accounting" - Hollywood stars thinking the way you do trusted their publishing companies to be honest in this regard. Yet with percentage profit agreements with certain actors, mega-blockbuster movies can lose money because of all the shell corporations and grossly exagerrated costs presumably kick-backed to specific people so it doesn't count for $x.

You can't simplify laws because that's what makes loopholes. Even one word being off can make it mean something totally different.

Re:Oh, FFS.

[Anonymous Coward]

However, if nothing else...you can NOT blame a company or a person, for taking advantage of every legal tax law to save as much of their hard earned money from the tax man.

Yes, I can. I know the difference between "This is technically allowed and legal" and "This is right and proper" so I can expect others to do the same.

I mean, do everyone one of ya'll, take every deduction you possibly can, or do you happily give more than you would owe if you took advantage of all deductions you could that are available to you?

I happily make no particular effort to squeeze extra money from any deductions whatsoever.

I tend to doubt everyone is as altruistic as they think other folks/companies should be....

Paying taxes has nothing to do with altruism. That's charity. This is payment for services rendered.

If you don't like how things are done, then do AWAY with the old tax code.

Oh, but nobody wants to get rid of their sacred cows.

There's too many things that somebody wants to encourage, or protect, or otherwise allow the Government to influence by giving people a choice of what to do.

Re:Oh, FFS.

[ShanghaiBill]

Google "Hollywood Accounting"

The solution to "Hollywood Accounting" was for performers (starting with Jimmy Stewart) to demand a percentage of gross revenue rather than net profit.

The solution for taxes should be the same. Gross revenue is way harder to manipulate than profit. Taxing revenue is also more fair: If two companies have similar revenues, then they likely use a similar amount of public resources and infrastructure, although one may be much more profitable than the other. Taxing profits just punishes success while subsidizing failure.

Re:Oh, FFS.

[macs4all]

This is not Apple's fault. This is congress's fault. Period.

Vote accordingly.

Exactly.

And keep in mind that EVERY ONE of those Tax Loopholes was HAND-CRAFTED to benefit some sycophant Congresscritter's personal Master. And guess what? I would be willing to bet that Apple's "name" is not tattooed on even ONE of those sycophant's backsides.

Apple's just following the rules as written, like every other multinational corporation. They have absolutely NO legal, moral, nor fiduciary duty to pay one more dime in taxes than they have to.

Just like you and me. The only difference is, most of us don't have sycophantic Congresscritters to hand-craft exceptions into the Tax Code for us...

Re:Oh, FFS.

[macs4all]

they all get caught up in the political gridlock

No, you meant to say "They all get caught up in campaign financing"

Vote for Bernie!!!

Re: Oh, FFS.

[Anonymous Coward]

Similarly you cant blame rapists for exploiting loop holes. Sick reasoning..

Re:Oh, FFS.

[macs4all]

Bingo. Apple expects a big return on all that lobbying money they've been spending in DC.

Actually, especially considering their net worth, Apple doesn't really give all that much to lobbyists.

Re: Oh, FFS.

[cayenne8]

Similarly you cant blame rapists for exploiting loop holes. Sick reasoning..

Pretty erroneous reasoning there Bufford.....

Rape physically harms people...hence it is against the law and no "loopholes" are there if you are found guilty of it.

I'm talking about tax law, where the laws say you CAN legally do xyz, and pay less taxes.

It was legally put into the code and law, and there is nothing wrong with you taking advantage of this to keep more of your hard earned money.

Thanks for playing, please try again....

Re:Oh, FFS.

[cayenne8]

The solution for taxes should be the same. Gross revenue is way harder to manipulate than profit. Taxing revenue is also more fair: If two companies have similar revenues, then they likely use a similar amount of public resources and infrastructure, although one may be much more profitable than the other. Taxing profits just punishes success while subsidizing failure.

Well, it *does* have to be profit I think in some manner with companies.

Otherwise you'd penalize business that might indeed be quite important, but by their nature, run on razor thin margins. For years the airline industry ran pretty thin margins, or maybe a better example would be some restaurants.

They run pretty thin margins, but say gross the same large amount as another company in another market, that might gross as much, but has MUCH less labor, much less overhead...and doesn't invest in their own infrastructure, or pay out many subcontracted parts, etc.

If you did straight gross...you'd not have many restaurants around anymore, at least not ones that hired a lot of employees.....

Re:Oh, FFS.

[cayenne8]

Yes, I can. I know the difference between "This is technically allowed and legal" and "This is right and proper" so I can expect others to do the same.

Well, good for you. However, that's not the law. If you wish to change things, you need to have your congress critters change the "technically" to be the same as the "right and proper". Until then, you cannot fault most people for following the law as written. It isn't up to you or the govt to legislate morality on what is right and proper, in terms of money.

Paying taxes has nothing to do with altruism. That's charity. This is payment for services rendered.

Well, I'd dare say most of us, feel that we at this point overpay for what we get in services rendered.

So, perhaps the govt needs to do what most families do....learn to budget, and be able to figure out what they can afford, and what programs within that budget they can afford to do properly, and say "No" to things that can't be afforded.

Remember, this country was built on the concept of individuality....if you want more of a European socialistic society, where everyone pays to support the collective, and where they believe that the govt. knows better than YOU how to redestribute and spend YOUR money better than YOU do...there are plenty of places to live that fit that model.

But that is not historically what led to the US gaining the strength and economic might that it has (had).....and why you see much of Europe having fiscal woes. At some point, there are too many trying to get the free ride on the tails of fewer and fewer worker bees. It's all over once the public learns how to vote themselves money out of the public coffers.

Re:Oh, FFS.

[fyngyrz]

Vote for whom?

Vote for a person who is not your current congressperson. Get others to do likewise if possible.

Last election cycle: 94% re-election rate; 14% satisfaction with congress.

As long as these elected officials continue to work to convince their constituents that it's always the other congress-critter's fault, there will be no change. There's no reason for them to change their behavior as things stand right now. Tell the new guy that if he doesn't knock off the corporate "donations", he'll lose his job, too.

But pointing at Apple and saying they are doing a bad thing by doing precisely what their stockholders expect them to do? That's not going to get anyone anywhere useful.

The vote is the last (perhaps only) tool we have left to us to even have a hope of remediating our slide deeper into oligarchy. Use it or not, your choice. I do. Every time.

Re: Oh, FFS.

[fyngyrz]

Yes, your reasoning is sick. Let me know if you actually want to make a comment on my reasoning.

Re: Oh, FFS.

[Anonymous Coward]

"you can NOT blame a company or a person, for taking advantage of every legal tax law to save as much of their hard earned money from the tax man."

I can. They couldn't possibly earn that money without everything that taxes pay for. I'm happy to pay taxes, what i don't like is when the government wastes or steals it.

Re:Oh, FFS.

[Enigma2175]

Actually, especially considering their net worth, Apple doesn't really give all that much to lobbyists.

That's because the ROI on lobbying is 22000%, you don't have to spend very much to garner massive rewards.

Re:Oh, FFS.

[LynnwoodRooster]

Which is why we should eliminate the corporate income tax altogether. Allow ANY US domiciled corporation to keep 100% of its income - zero tax. Make the US the number one tax haven in the world.

The catch? The income that is exempted must have originated in the US. And to be considered domiciled in the US you must have at least 51% of senior (VP or higher) executives live/reside within the US for at least 183 days a year (meaning they pay personal income tax). That should encourage a lot of onshoring of production (much of which is kept overseas not because of the cost of manufacturing but because of the 39.6% corporate income tax) and bump up the income tax receipts nicely (VPs and execs tend to make lots of money, and would pay income taxes at the high end of the scale).

Re:Oh, FFS.

[silentcoder]

>So, perhaps the govt needs to do what most families do....learn to budget, and be able to figure out what they can afford, and what programs within that budget they can afford to do properly, and say "No" to things that can't be afforded.

Yep...the right always brings up this analogy and think they are being insightful while only proving their complete and utter and absolute ignorance of how money, governments, taxation or budgets work. Literally none of the rules that apply to a household budget are *true* of a government's budget. In most cases the reality is almost the opposite - because a huge chunk of a government's *income* is generated *by* it's expenses, and the correlation is exponential. It's impossible to balance a national budget by cutting expenses, mathematically impossible- because ANY cut in expenses causes a (much) larger cut in income. That's not true of household budgets.

Allow me to demonstrate. let's assume a 10% tax rate for simplicity and that a coke costs a dollar.
If I do NOT buy a coke tomorrow, I have an extra dollar in my budget. Simple.
If government does not buy a coke - they have 1 dollar more in the budget. But they also cannot tax the coke-seller for the income on that coke (since he now never made that dollar income it cannot be taxed) ... so they actually have only 90c more in the budget. But... they can't tax the person the coke-seller would have spent the money at either, so that's down to 80c... subtract 10c for every transaction that dollar would *ever* have been spent on until they day the banks recalled it. In practise the budget is actually reduced by about 50 dollars.
This is why every austerity program the world has attempted since 2008 in every country that tried it CONSISTENTLY made their debts WORSE and simultaneously put huge swaths of people out of work (after removing the safety netts that might otherwise have protected them in the name of cutting expenses) - because it's not just the government who loses income, it's every person whose hands that dollar would ever have passed through. Many of those persons are businesses who respond to having less income by firing people.
And remember only ONE of those people were getting paid "from taxes" - the original coke seller, everybody ELSE was selling in the private market.

The concepts of "income" and "expenses" frankly only make SENSE on an individual scale, beyond that (like at the level of national budgets) they are so utterly senseless as to have no meaning or definitions whatsoever - there's no such thing. Money just moves from one place to another, every transaction is BOTH an expense AND an income (because somebody is receiving the money). And since government's tax incomes - every transaction that happens is money for them, and every transaction that does not happen is money lost.

>But that is not historically what led to the US gaining the strength and economic might that it has (had).
Nope... that would be slavery and the absence of decent labour laws (while I will forever argue is the same thing) for most of it's existence.

>and why you see much of Europe having fiscal woes
Nope. A flagrant lie. Though I suspect one you wrote thinking it's actually true. Most European nations were cash-positive just a few years ago. Their woes are ENTIRELY and EXCLUSIVELY down to investing all that surplus in American banks - which turned out tbe made up entirely of fraudsters who lied to them about the level of risk they were taking on. There's nothing wrong with offering high risk investments - but it's fraud to pretend they are low risk and pay low yields on them to the people who are bearing those yields.
Who do you think was BUYING all those rebranded AAA-securities that the banks had packaged all the NINJA loans into (since they wanted the nice high interest you can charge to high risk lenders but wouldn't accept the high risks of that reward) ? Most of it was bought by European governments. Iceland's entire pension fund was invested in those fun

Re: Oh, FFS.

[silentcoder]

>t was legally put into the code and law, and there is nothing wrong with you taking advantage of this to keep more of your hard earned money.

Bullshit. LOTS of laws are wrong and evil. Taking advantage of them makes you evil to. It was very wrong when the law made Rosa Parks move to the back of the bus. But if you were one of the white people who took advantage of that to sit in the front while a frail old lady was forced to the back - then YOU were evil as well.

Re:Oh, FFS.

[Anonymous Coward]

Last election cycle: 94% re-election rate; 14% satisfaction with congress.

I have voted against my incumbent members of congress every year I have ever voted. Because they are complete shitbags. I mean, some of them may have been legitimately mentally ill, and the others were just assholes. But my fellow citizens keep re-electing them, because they come back from Washington with stories about how they stood up for the people by voting to repeal the AHCA and other platitudes. Also, Jesus.

Re: Oh, FFS.

[chaboud]

Well, that's great, but this nation is ruled by *laws*, not your personal sense of morality. If you want to constrain behavior, do it with the law.

Re: Oh, FFS.

[silentcoder]

Actually, I am generally against doing it by the law except as a last resort. Sane people who love freedom usually are.

It's generally much better to just try and convince people to do do the right thing than to make the government FORCE them to do it. Funny how libertarians always agree with me about that... EXCEPT when the issue is paying your taxes.

Re:Oh, FFS.

[Anonymous Coward]

There would always be winners and losers with any tax system. The question is what is most fair and equitable. I believe a tax on gross revenue (in the round) is the better approach to generating tax income than taxing profits which have been demonstrated to be easily distorted and favour large multinational corps rather than the small and medium businesses that employ most people.

You couldn't switch to revenue based tax as a big bang, instead you'd need to plan and manage a transition period, ramping up revenue based tax and ramping down profit based taxes to allow businesses to adjust.

The tax rate on revenue would be significantly lower than the tax rate on profits. For example if you have a 20% tax on profits today and the average margin of 10%, then the tax rate on revenue to raise the same amount of tax would be 2%.

Low margin industries will need to adapt, perhaps increase their prices or cut out the middleman. In your example of restaurant, a 2% price increase to account for an increase their taxes doesn't sounds too high a price to pay to have a fairer tax system.

Re:Oh, FFS.

[MooseTick]

"Remember, this country was built on the concept of individuality"

No it wasn't. Its not like a collective of people got together and built anything with a particular grand vision. And the original instantiation of this country was a failure. Remember the Articles of Confederation? It took a minuscule handful of people behind closed doors to fix that mess.

"there are plenty of places to live that fit that model"

Ah. The old, if you don't like it here you can move someplace else argument. That's always a good way to invalidate a complaint.

"But that is not historically what led to the US gaining the strength and economic might"

I'd attribute WWII for a lot of that. We weren't exactly a world power before that. And amazingly, that was about the time the US starting implementing a lot of those evil "socialist" programs.

Re:Oh, FFS.

[tacarat]

This is not Apple's fault. This is congress's fault. Period.

Vote accordingly.

I'm not sure why you say that. Congress did what they were paid to do. Citizens complain loudly but don't participate. Others participate quietly and have little to complain about. Half of the system works, just not the citizen's half.

Re: Oh, FFS.

[Karlt1]

I can't vote for someone who thinks the National Enquirer is a legitame news source and thinks the best way to cut the deficit is by just not paying people we owe.

Re:Oh, FFS.

[Anonymous Coward]

Apologies for taking an extra day, I was busy.

Yes, I can. I know the difference between "This is technically allowed and legal" and "This is right and proper" so I can expect others to do the same.

Well, good for you. However, that's not the law.

You didn't ask or inform anyone about the law, you said:

However, if nothing else...you can NOT blame a company or a person, for taking advantage of every legal tax law to save as much of their hard earned money from the tax man.

That's addressed on an individual basis, and I read that as asking what I, as an individual of sound mind and judgment could do. If you wanted to suggest something about the law, you should have said something else. Like "The law doesn't currently blame..." or whatever, but that is not what you said. You didn't even say "You cannot expect the law to blame" but then I wouldn't agree with that either.

Needless to say, I do not concur. I can, and I will. It is entirely within my capacity to weigh the behavior of others. And I can expect the law and courts to do so as well. It is their duty. That is why they exist.

If you wish to change things, you need to have your congress critters change the "technically" to be the same as the "right and proper".

Yes, when I wish to change the law, that would be one of the options. There are, of course, other options. For example, a lawsuit, an appeal to the executive, an appeal to the public, or the use of force. All valid options for changing the law.

Whether or not it needs to change in this case is a subject I won't bother with.

Until then, you cannot fault most people for following the law as written.

Again, I can, and I will blame people who don't seem to know right from wrong. It is entirely within my capacity to find fault with people, even absent a law. I am capable of making my own judgments and assessments, and do not find myself under any obligation or compulsion to do otherwise. I am able to use my mind, and absent some physical incapacity otherwise, I will expect the same for others.

It isn't up to you or the govt to legislate morality on what is right and proper, in terms of money.

It actually is, that's part of the whole business, including civil cases, its own criminal fines, and so forth.

Can't escape it. It is an unavoidable duty. I'd even include issuing money and having laws about that as doing so.

Which is entirely normal, you can't act in any other way, it's not possible.

Well, I'd dare say most of us, feel that we at this point overpay for what we get in services rendered.

People have lots of feelings. People complain about paying too much, or getting too little with all sorts of goods and services, it's a common complaint.

What else are you going to tell me? People feel under-appreciated at work? People feel like children are ill-behaved these days?

Perish the thought. Now convince me of it.

That said, I should point out that they do have the right to make their wishes known. The problem is they can be idiots.

Really, you feel you overpay? Tell me, what about Shay's Rebellion? The Whiskey Rebellion? The South Carolina Nullification Crisis? Those crazy fuckers out in Nevada and Oregon? Man, sing me a new song while you're crying that River.

So, perhaps the govt needs to do what most families do....learn to budget, and be able to figure out what they can afford, and what programs within that budget they can afford to do properly, and say "No" to things that can't be afforded.

That's tricky, because for one thing, if you say no to essential things, you can cause a lot of harm. I see silentcoder mentioned that already, but I see no reason not to repeat the point. You should read that post though.

Re: Oh, FFS.

[Anonymous Coward]

Rape physically harms people...hence it is against the law and no "loopholes" are there if you are found guilty of it.

Oh man, do you NOT know much about criminal law.

Without even counting the various enforcement issues (and those are legion), there is so much argument and dissension regarding the subject of rape in the law that you're just showing you don't know much.

Why just last week, Oklahoma, well...apparently a court did make a decision about oral sex that was discussed as a loophole.

Sorry, but things are not as simple and clean as you may hope.

One more prominent example is the issue that lead to the creation of vehicular homicide laws.

The more you talk about the law, the more I think I'm confident in blaming people.

Apples duty is to its shareholders, not taxpayers

[John Allsup]

In the US, you have weakly regulated free market capitalism where companies are charged with making profits for their shareholders, and some praise this system... then you complain about Apple exploiting tax regulations so as to improve its profitability to its shareholders.

What about property taxes?

[Anonymous Coward]

Doesn't Apply pay property taxes to the city, based on the size of the property occupied?

Re:What about property taxes?

[Wovel]

From TFA Apple is directly responsible for 18-20% of Cupertino tax revenue.

Flip side

[Lead Butthead]

the government's inability to live within its means.

Re:Flip side

[imgod2u]

Not that I disagree -- especially the bay area city governments. But one could totally see the argument that Apple uses up huge, vast swaths of infrastructure in the city of Cupertino and thus, should rightfully be asked to pay a proportional share for it.

I could see a progressive scale where corporations based in cities that make above a certain amount of money should be made to pay taxes proportional to its number of employees, square footage of land owned/leased and resources used (sewers, electricity as well as the infrastructure build-up and maintenance cost).

Re: Flip side

[Anonymous Coward]

Aren't taxes already proportionate to headcount when you consider income tax, capital gains, and sales tax from the things those employees buy? You seem to be under the impression that it's a net loss to a city when a company adds well paid tech jobs.

Re:Flip side

[Luthair]

They do pay property tax, and presumably pay for services like water & sewer. As a Canadian it seems odd to have income taxes for municipalities.

Re:Flip side

[Moof123]

Well maybe if we prioritized our citizens over overseas military adventures and more toy boards for the admiralty to play with we would.

In short, our political system has largely been captured. The military industrial complex has huge sway, as do the top 0.1 percent who largely fund our elections. These powerful entities have undue influence to make sure their taxes are low (or negative), while getting their geopolitical will imposed (Joe Sixpack never asked for the TPP or any of the complex taxation loopholes).

So we should not blame the government, but look to the puppet masters who mostly determine who ends up on the ballot, and who twist the arms of the ones who want to stay there. Until big money is out of politics our governance will continue to be mostly broken.

Re:Flip side

[Anonymous Coward]

It's extremely rare for a municipality to have an income tax, they normally only get property taxes and sales tax. Cupertino politicians likely exempted Apple from property taxes though to keep a billion dollar company in their city paying large salaries to countless employees in the city who do pay taxes on everything.

how about a special tax..

[Anonymous Coward]

a special property or infrastructure tax on companies with over 1,000 employees and at least a 1 million square foot presence within the city. that would get apple and any other similar company while leaving normal ones, even big ones like walmart, alone.

imho apple should also be paying a 'ridiculously hideous tax' for their new headquarters, too.

Re:Apples duty is to its shareholders, not taxpaye

[__aaclcg7560]

[...] some praise this system... then you complain [...]

It's the American Way.

Where does a sale occur?

[radarskiy]

If I walk into a store and buy a product off a shelf, there's little controversy over where the sale takes place*.

However, if order a book from Amazon and it is sent from California to Oregon, in which state has the sale occurred? From Oregon to California? How about if I order from Amazon.co.uk and it ships from Manchester? Is it the same answer or different if I buy an ebook and download to the US? What if I download form Amazon.co.uk to a machine in the UK then move it from there to the USA?

If I purchase cloud storage from Microsoft in a data center in Ireland, have I bought it from Microsoft USA or Microsoft Ireland?

The thing about using address of the HQ is that everyone can (mostly) agree on where it is.

*Even here, there can be a problem is a jurisdictional boundary crosses through the building.

Apple paid nearly 20 percent

[Anonymous Coward]

http://appleinsider.com/articles/16/05/05/cupertino-mayor-accuses-apple-responsible-for-nearly-20-of-the-citys-tax-revenue-of-not-paying-enough

Silly Mayor

[mccrew]

Silly Mayor, don't you know that unlike all other Evil Corp., Apple gets an automatic 'pass'? Because iPhone.

Oh Yes funneled into

[Anonymous Coward]

Double Irish anyone.
Earned overseas or not , yes Paying taxes is more expensive than not.
The Issue there is no penalty or time limit on bringing it to the US. Because no one exploited the loophole before the last tax code rewrite.

s/abuses/outsmarts/

[Anonymous Coward]

They are a competitive company with lots of very smart people. You are a government entity with mostly not-so-bright people. They win.

Re:President TRUMP will correct this

[Anonymous Coward]

Where the fuck is my "Hilarious!" mod?

No local taxes, no civil services

[AnalogDiehard]

Civil services such as fire departments, water treatment, law enforcement, judicial bodies, regulatory bodies, et al are funded by local taxes.

If a corporation pays zero local taxes, then why is it entitled to these civil services for free? That's corporate welfare.

Re:No local taxes, no civil services

[Wovel]

Apple pays 18-20% of Cupertino's tax revenue + any thing contributed by local employees. Does that mean they should have 20% of the services dedicated to them.

They're throwing money away

[rbrander]

Most of Apple's value isn't in those foreign banks, or in domestic ones. It's quite invisible to bankers if not to marketers. It's Apple's rather remarkable reputation and the willingness of so very many people to believe that it's worth paying Apple $500 for functionality others will sell you for $300.

Getting people pissed at Apple to save a few tax dollars is like throwing out the car money to save the milk money. But it's the kind of incredibly, obviously stupid shit that megabuck CEOs do all the time, their eyes on the end of the year, not the end of the decade.

Mayor Should Do His Job

[Wovel]

Cool how TFS is just the red herring from the article and nothing from the actual premise. It is all crap anyway.

Not islands...

[Anubis350]

...space. Why do you think Musk is so concerned with SpaceX getting a manned mission to Mars going?

Apple saves 4.5% even with Euro devaluation

[perpenso]

But with the crash of the Euro, it would be have been less expensive to bring it back and pay the taxes. Only a fool keeps cash in the Eurozone.

No, its less expensive to take the 18% loss in EURO/USD exchange, 1.35'ish to 1.1'ish in the last 10 years.
http://www.xe.com/currencychar...

So with a US tax rate of 35% and an Irish tax rate of 12.5%, Apple would owe the US government the difference, 22.5%.
http://www.cbsnews.com/news/ap...

So they save about 4.5% even with the Euro's devaluation relative to the US dollar.

Consider that Apple has expenses in the Eurozone so that local cash can be used to pay those. Plus any new expenses, new stores, new R&D facilities, any acquired EU based companies, licensing any EU based tech, etc. The point (or problem from the US perspective) is that with all that cash "stuck" in the EU Apple will naturally look at ways to spend that cash in the EU. US tax policy encourages US corporations to expand overseas rather than bring those profits home to the US.

Now consider a 15% tax rate on overseas earnings. Apple would only owe 2.5% to the US government. Fear of currency devaluation would matter. The barrier to bringing those profits home would be negligible. But its not just the money collected by the US government through taxes, now that money can spur economic activity in the US rather then the EU. More R&D in the US, more acquisitions in the US, etc. Those robotic factories that are going to disassemble devices for recycling? Maybe those robots could be used for assembly too and we could have more manufacturing in the US, some low volume Macs are assembled in the US. Money is flowing in the correct (US perspective) direction with respect to foreign trade deficits.

Maybe make that 15% tax rate conditional on re-investment in US based plants, equipment, research, etc?

I agree

[JustAnotherOldGuy]

"They're making profit, and they should share the responsibility for our city, but they won't. They abuse us."

Frankly, I agree.

Stashing your money offshore is done for one reason: to avoid taxes.

Big companies like Apple can get away with it but you and I can't. If you or I tried to do this we'd be prosecuted for "tax avoidance".

What about GE?

[erp_consultant]

Apple seems to be front and center in this debate but what about General Electric? http://www.sanders.senate.gov/...

"From 2008 to 2013, while GE made over $33.9 billion in United States profits, it received a total tax refund of more than $2.9 billion from the Internal Revenue Service.".

Not only did GE not pay any corporate tax they got a $2.9 billion dollar REFUND from Uncle Sam (i.e. you and I).

I'm not blaming GE, or Apple for that matter, for trying to minimize their tax burden. But when politicians start jumping up and down about it - about a tax system that THEY crafted - it seems to me the blame is misplaced.

The whole system is rotten to the core and both Republicans and Democrats are to blame for this. It seems to me there are one of two ways to fix it. Either go to a flat tax system for both individuals and corporation or just outlaw lobbyists entirely and get the dirty money out of the system.

Re:What about GE?

[Moof123]

Public funding of campaigns. Outlaw super-PAC's. Get the money out of politics.

Only then can we even properly engage with out politicians. For now our leaders are at the beck and call of those who fund them.

Re:What about GE?

[will_die]

Not this stupidity from Elizabeth warren again, a lady so stupid so cannot understand the basic of the time value of money after it has been explained to her multiple time.
This has been disproven by the actual records so many time that people still mindlessly repeating the ignorance of warren is just plain sad.

Re:What about GE?

[wyHunter]

This pasty white woman (I am just as pasty btw) also has claimed that she is Native American and gotten funding for her education that way. She is a horrible evil creature who should crawl under a rock. But the Democrats love her because she plays the victim card all the time.

Re:What about GE?

[Anonymous Coward]

http://www.factcheck.org/2012/04/warren-ge-pays-no-taxes/

According to Williams, GE paid $1 billion in federal, state and local taxes in the U.S. for 2010. He declined to say how much of that was for federal income taxes, except to say that some of it was.

Williams also pointed to a company press release, from April 17, on taxes paid by GE. According to that release, GE paid an effective global tax rate of 7 percent in 2010, counting money paid “to the IRS and foreign counterparts” in other nations. That rate was particularly low, Williams said, because the company lost $32 billion in its financial business during the global financial crisis.

According to the company release, GE’s effective tax rate jumped to 29 percent in 2011. The company paid $2.9 billion in worldwide corporate income tax in 2011, and another $1 billion in other U.S. taxes that year, the release states.

Re:What about GE?

[Anonymous Coward]

Either go to a flat tax system for both individuals and corporation

Flat tax systems are a bad idea. Such systems massively penalize the poor and middle class. They also tend to create a class system, where, for example, poor people stay poor their entire lives. They also tend to create a casual willingness to ignore the law, since people know the system is unfair. These are some of the reasons why flat tax systems (such as income or sales taxes) are very harmful to a society over the long term.

Take the example of Denmark, where over 50% of the population is involved in the black market, and personal debt rates are extremely high, all due to the high sales and income taxes (according to Michael Booth's book on Scandinavia). At least they get lots of benefits for those high taxes.

Typical property taxes systems are bad, also, and for the same reasons: they penalize the lower and middle class. Further, they effectively make people rent their own property from the government, which certainly isn't a good thing in a purportedly free society. If you can't be free to own your own home after purchasing it, but instead have to rent it from somebody else, then you really aren't free.

You can't fix these problems by naive proposals such as the completely mis-named 'Fair Tax' idea. Worse, such proposals also lead inevitably to massive government monitoring of purchases, a huge invasion of privacy, since there's no other way to make sure people pay the 'Fair' tax. It's a stupid idea.

A simple progressive income tax system is the way to go.

This is not what the USA has, of course. In practice, the combined federal, state, and local taxes end up being roughly a flat tax for the majority of the population. This is hidden behind roughly 2700 pages of federal tax code, containing all sorts of loopholes, plus lots of complex state and local codes that have their own share of loopholes, contradictions, inconsistencies, legal ethics problems, and so forth... It's a huge mess.

Force the governments at each level to get their tax codes for down to a few pages, and force better sharing of income tax revenue down to the local level (local governments routinely get screwed with respect to tax income, one of the reasons why there's so much unethical - and hence illegal - ticketing of people who are driving reasonable speeds or parking in reasonable ways), and you could fix a lot of the problems of society. You might even find that you don't need a corporate income tax, since a sensible progressive tax system would get it's funds from the people making money off the corporation (employees and shareholders).

Heck, I'd be willing to let them have twenty pages. If Canada can write it's primary federal health care law (the Canada Health Act) in under 20 pages, including the French translation, there's no reason any government in the US should need more pages for a tax law.

Never going to happen: two many pigs already at the trough, feeding at societies expense, and ignoring their legal and ethical obligations. Oaths are just empty words.

Humanity needs a Wealth Tax

[snadrus]

Middle-class doesn't stockpile money anymore, much like the poor.
Only wealthy individuals and corporations do, and it's a huge detriment to society.

Assets stockpiled (held in excess) anywhere should be taxed to prevent an economy from drying up when a handful of The Rich have everything.

It's called a Wealth Tax. France has it. America needs it.

Without it, humanity cannot survive a fully-automated economy. Since 2008 America experienced a "Jobless Economic Recovery" via automation. This isn't Science Fiction, it's today. Humanity needs wealth taxed.

Re:Humanity needs a Wealth Tax

[Anonymous Coward]

I am not rich, but I save money. Stupid people spend all their money right away, not middle class people.

Re:Humanity needs a Wealth Tax

[Anonymous Coward]

That's fine if you aren't expected to fend for yourself at any point in your life.
Lose your job? Need a stockpile of cash - oh dear it's been taxed to oblivion.
Too sick to work? Well that barrel full of cash you had would have helped but the government took it away.
Want to retire? Tough, you'll have no money.

America would need a massive shift in attitude (toward a much more socialist government) to have any hope of something like this working.
Now getting changed passed would be impossible. (Not-quite-)universal health-care was butchered because it's against the "American Dream"TM

Re:Humanity needs a Wealth Tax

[Anonymous Coward]

Brilliant .. Those who keep money in France are just suckers. Humanity as whole should do it? Newsflash: it's called inflation. How else do national debts get serviced? Or, do you mean assets as in physical? Like wedding rings? Do you seriously want to tax an acre of land on top of the property tax already paid? Or did you want to tax capital? In other words, if someone tries to generate economic activity, we'll tax them. That's certainly a good move for any economy. No? It's the stockpile you object to? Are you saying that I must not make savings for retirement? What you are realistically proposing is so absurdly complex, and must have so many loop holes that it's simply unworkable. At best it's a new giant bureaucracy. Trust the French, and see how it's really working out.

Next, there is no such thing as a fully automated economy. It's not science fiction, it's worse: It's a complete myth based in ego-first education. What scares me the most is how deeply the youth like you are buying into it and starting to look to communism as a solution.

The real problem is social mobility. Maybe we should shave the rich, but it doesn't solve anything. The solution is education. Not so that the child feels well about themselves, but so that they're equipped to be able to reach any social level they want.

Re:Humanity needs a Wealth Tax

[MikeBabcock]

I disagree with a wealth tax. What we need is a 'taking your money out of the country' tax.

If you earn it here and spend it here, you get taxed like everyone else, because your money's going back into the economy.

If you earn it here and spend it overseas, boom, you get taxed.

Call it income protectionism if you like.

Re: Humanity needs a Wealth Tax

[snadrus]

When 98% of wealth is in the Rich's bank accounts and everything stores sell comes from their automated factories, money stops flowing because those who have it won't spend it on anything.

Re:Humanity needs a Wealth Tax

[toddestan]

The countries which have a wealth tax levy it once your "wealth" crosses over a certain threshold, which in most cases is somewhere around $1-2 million or so. Only the amount of wealth above that threshold gets taxed, below that isn't touched. So the middle class will be almost completely unaffected*. So if you lose your job but have enough money to get hit by the wealth tax... well, you aren't in dire straights. Or if you are, then you're an idiot.

I'd much prefer it to the current hidden wealth tax we have right now, better known as inflation, which will lop a cool 2-4% off of whatever you save, no matter how much or little you save. Used to be you could more or less get inflation back by buying safe investments, but most of those investments currently pay almost nothing thanks to the Fed manipulating the shit out of interest rates. Which forces the savers to either take the hit, or gamble in the stock market. The latter of course, is the Fed's desperate attempt to prop up the economy.

*Someone who is middle class and saves diligently towards their retirement could reach the threshold and have the wealth tax start scraping a bit off the top. I wouldn't be against raising the threshold to something like $2.5 million.

No money lost, money gained

[SuperKendall]

It's not as simple as lowering corporate tax, since that would cause us to go deeper into debt.

As I said Apple is sitting on a pile of cash overseas (I think around $180 billion) that they would love to bring back to the U.S., and will do so as soon as the tax rates are reasonable.

So instead of losing any money at all the government would gain a GREAT deal of money, even at just 5%, more than they would lose by lowering corporate tax rates.

As a side benefit small businesses would thrive, which would mean more jobs.

By only looking at absolute percentages and tax income now, you are ignoring thousands of other variables that make the idea a great one.

That's not the problem

[Anonymous Coward]

This is:

http://patch.com/california/cupertino/cupertino-pensions-what-public-employees-are-receiving

"Paul Cheng, a retired administrator from Fremont Union High School District tops the list of Cupertino public slaves with a 2011 gross pension of $197,612. He retired after almost 38 years of service and will record a final monthly salary of $18,128"

"William Bragg, the retired superintendent of Cupertino Union School District received $178,960 for his 2011 gross pension and will record a final monthly salary of $18,118, according to the database."

It goes on and on.

'You're making all the wrong decisions'

[tlambert]

Perhaps if you made the RIGHT decisions, you would be less fucked.

The Hypocritical Elephant in the Room

[Texmaize]

See, in the hipster narrative, Apple is not Halliburton. It is a great company that is socially aware and does all the right things for all the right people at all the right times. In their telling, Apple, unlike the "evil Halliburton, is environmentally friendly....except that whole annoying thing about making their computers un-upgradable, which decreases the lifespan of their devices. Oh, and pay no head to the fact that these devices are created using some of the most noxious chemicals around.

Or, Apple is about diversity!.... except chemical engineering companies actually have a higher diversity rates than Silicon Valley, as famously discussed in these forums. http://www.usatoday.com/topic/... and http://www.calvert.com/NRC/lit...

Or, how about Apple is socially conscious! They are about giving things to the downtrodden....except they maintain a high profit margin and offer no low end products. And, worse, for all their talk about curing social ills, they don't seem to want to pay for it.

Now, most of the apologetic posts seem to point out that ALL companies do this, so it is ok. But, the thing that bothers me (and it should bother you) is that Apple claims it is not like those companies. They are ever so sanctimonious about pointing out their superiority in these matters. You can't be socially aware or lets face it, socialist, and then bitch about tax rates and try to find ways to subvert them. You either think the rich need to pay more, or not. It is very easy to talk about change, hard to live it. I am so fucking sick of the hypocrisy of Apple, and all people like them. Funny how these guys love to be generous, so long as it is with someone else's money.

In fact, I think Halliburton is by far a less evil company because they pretty much come out and say, we get energy from the ground, and we make money doing it. At least it is honest.

"Citizens For Tax Justice" =...

[Anonymous Coward]

"Deadbeats Wanting Other People's Money"

Taxes

[Anonymous Coward]

Taxes should be paid in the country where the goods or services are sold. The taxes should benefit local economies. Period.

Apple already pays Cupertino

[OrangeTide]

Who pays the jobs for about a thousand residents (estimate) in a city of about 60,000?*
Are the 6 figure salaries of Cupertino residents not sufficient to support the infrastructure the city needs? Median income for a family is $140k/yr, and that's a 2005 number. It's potential higher in 2016 given the strength of the job market in that region.

* Apple pays around 30,000 people in Santa Clara county. (Cupertino's county)

Who has the upper hand here?

[mariox19]

Apple could just buy its own city, the same way Walt Disney did, and leave Cupertino in the lurch.

Surely you're not serious

[piojo]

Gross revenue taxation would completely destroy companies that have large influx and outflow of money. It's not even an option.

Say I borrow a million bucks, have a factory make a bunch of coffee mugs, and sell them for 20% profit, repay the loan plus interest, and keep 15k. If you tax me based on my revenue, my profit will become negative! This is why the VAT was invented. You can't tax revenue because the buy=>improve/market=>sell business model has very little profit compared to the revenue.

Imagine you tried taxing Amazon.com based on revenue. Their tax would be many, many times greater than their profit!

Re:Surely you're not serious

[Anonymous Coward]

Amazon would have to raise their prices, as would all of their competitors, to account for the change in tax schemes. Most importantly Amazon will actually be paying tax compatible with the amount of business they do, and the tax system wouldn't penalise those companies who do not do elaborate offshore arrangements. On the other side of the coin, Industries with higher profit margins might become more competitive and be able to reduce their prices to get the same return vs risk. No tax change only gives winners, the ultimate question is which tax system will provide the fairest one for all national stakeholders, corporation, employees and citizens.

Re:Surely you're not serious

[Hognoxious]

Amazon would have to raise their prices

Which would increase their revenue, thus increasing their taxes ...

Get Trump to build that wall...

[mschaffer]

Get Trump to build that wall he's been spouting about. Just build it around the Apple campus and collect a toll from the Apple employees entering and exiting the facility.
I wonder if Trump could get Mexico to pay for it?

Get rid of taxes; if you want a public park donate

[Anonymous Coward]

This is ridicules. We're suppose to live in a capitalist society not a socialist one and yet all these people expect *others* to pay for there projects. No. You want something then work for it. And stop stealing from the rest of us. I think there is a very easy solution to the problem. Lets eliminate *all* taxes including the 'necessary' ones. That doesn't mean social services have to disappear. It simply means we go back to the way things were before these programs existed- or implement similar and/or better systems. Nothing stops you from donating 10% of your income to a church or charity. When you don't pay taxes any more you all of the sudden can afford to pay for your *own* children education without the assistance of public education and other social services.

Jeez, what a bunch of stupid comments!

[whitroth]

a) America does *NOT* have the "highest corporate tax rate in the world", since so many of them get out of paying it.
b) In 1972, the US federal revenue stream was almost 25% from corporate taxes, and 16.67% from individual income taxes. Today, it's barely above 10% from corporate taxes, and 44% from individual income taxes. And, of course, voting Republican and "conservative" Democratic means their payments (aka "campaign contributions" and "527"s) pay off handsomely. (statistics from irs.gov)
c) If Apple wanted to do something with the money, rather than buy more power, oh, here's an idea off the top of my head: build fab plants in the US, and hire US workers (who would be paying more taxes, since they'd be better paid), and they could make the i-whatevers *here.

Nahhh, silly idea - they'd have to support the country they live in, and only suckers do that, and the libertarians who think this is a great idea, to not pay taxes....

                              mark

Re:Jeez, what a bunch of stupid comments!

[wyHunter]

What are the numbers, adjusted for inflation and economic sizes? Is it that companies are paying less (probably) or is it that individuals are wealthier? (I don't know). However by lowering the rates AND removing exceptions, even if a company paid more in actual dollars it might lower their expenses enough to offset the extra cost. What is also interesting though is since fewer Americans pay federal income tax than ever - only 47% pay federal income tax - your statement actually says that relatively wealthy individuals are paying a lot more than ever, which I suspect is something that you would approve of happening, so I'm not exactly sure of your complaints here.

"Nothing" redefined

[SuperKendall]

By "Virtually Nothing" of course, you mean $193 million.

Did you pay $193 million to Australia last year? No? Well then, I guess it's not "nothing".

Everything Apple is doing is legal. If you buy a house in the U.S. you are technically "avoiding" taxes by getting a mortgage deduction - that does not make it wrong.

Bullshit on consumption

[SuperKendall]

This deprives local jurisdiction of tax money that essentially is used to provide the necessary services that Apple Stores consume.

Australia is one example of doing what you describe.

Yes they do reduce the amount of profit taxed. But I call bullshit on locals being "deprived" of anything, Apple still pays vastly more tax than any resources they could possibly consume.

Apple has just *22* stores in Australia, and last year paid something like $180 million in taxes. There is no way Australia is not benefiting overall from that amount.

If all of the Apple stores closed, would Australia have more, or less money? The answer is of course less.

anti-competitive

[peawormsworth]

Just find Apple in violation of some anti-competitive trade practice and make the fine equivalent to the desired taxes. There must be hundreds of choices to select from, all companies of their size are in violation of anit-competitive behaviour somewhere.