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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."
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.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
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.
I am Slashdot. Are you Slashdot as well?
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.
Cost free eBook I read (by iBook/Kobo/Amazon/ObookO/Gutenberg etc.): "The Green Odyssey" by Philip Jose Farmer.
Oh, wait, that's Google. Nevermind.
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?
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.
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
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.]
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.
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?
Yes. That is how taxation works. You pay local, state and Federal tax don't you? Are you stupid?
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.
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.
And thou will not complain!
SJW's don't eliminate discrimination. They just expropriate it for themselves.
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.
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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".
Learn to love Alaska
Thank using roads without paying for them is theft.
Learn to love Alaska
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.
the government's inability to live within its means.
ELOI, ELOI, LAMA SABACHTHANI!?
Bingo. Apple expects a big return on all that lobbying money they've been spending in DC.
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.
Linux, you magnificent bastard, I read the fucking manual!
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
[...] some praise this system... then you complain [...]
It's the American Way.
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.
Silly Mayor, don't you know that unlike all other Evil Corp., Apple gets an automatic 'pass'? Because iPhone.
Hey, Windows users, there is no such thing as "forward" slash, there is only slash and backslash.
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.
Huh? The top individual tax rate in the 50's was 91%, not corporate. The top corporate rate was around 50%.
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.
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.
Relatively few Apple employees reside in Cupertino. So most of those rich salary dollars you cite leave the city immediately and don't return.
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
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.
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
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.
Eternity: will that be smoking, or non-smoking? I Corinthians 6:9-10
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.
Learn to love Alaska
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.
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.
Cool how TFS is just the red herring from the article and nothing from the actual premise. It is all crap anyway.
...space. Why do you think Musk is so concerned with SpaceX getting a manned mission to Mars going?
"goodbye and hello, as always" ~Prince Corwin, from Zelazny's Amber series
From TFA Apple is directly responsible for 18-20% of Cupertino tax revenue.
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?
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...
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!!!
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.
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.
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....
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
The profit originates where the item was purchased. Note profit, not income. Obviously licensing a patent to yourself is not a cost.
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.....
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
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.
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.
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
"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".
Just cruising through this digital world at 33 1/3 rpm...
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.
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.
I've fallen off your lawn, and I can't get up.
Yes, your reasoning is sick. Let me know if you actually want to make a comment on my reasoning.
I've fallen off your lawn, and I can't get up.
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.
Science & open-source build trust from peer review. Learn systems you can trust.
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.
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.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Perhaps if you made the RIGHT decisions, you would be less fucked.
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.
Enigma
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.
"Liberalism is a very noble idea, currently controlled by some very bad people. Be sure you do not get the two confused.
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)
“Common sense is not so common.” — Voltaire
Apple could just buy its own city, the same way Walt Disney did, and leave Cupertino in the lurch.
quiquid id est, timeo puellas et oscula dantes.
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?
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).
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
>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. ... 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.
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)
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
Unicode killed the ASCII-art *
>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.
Unicode killed the ASCII-art *
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.
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.
Unicode killed the ASCII-art *
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!
A cat can't teach a dog to bark.
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?
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
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.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
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.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
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!
Self-importance and self-indulgence is the root of ALL evil.
"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.
Ninjas don't carry tic tacs
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.
"Common sense will be the death of us all"
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.
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.