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Every US Taxpayer Has Effectively Paid Apple At Least $6 in Recent Years (arstechnica.com)
An anonymous reader shares an ArsTechnica report: Apple has received at least $6 per American taxpayer over the last five years in the form of interest payments on billions' worth of United States Treasury bonds, according to a report by Bloomberg. Citing Apple's regulatory filings and unnamed sources, the business publication found "the Treasury Department paid Apple at least $600 million and possibly much more over the past five years in the form of interest." By taking advantage of a provision in the American tax code, Bloomberg says that Apple has "stashed much of its foreign earnings -- tax-free -- right here in the US, in part by purchasing government bonds." As The Wall Street Journal reported in September, American companies are believed to be holding approximately $2 trillion in cash overseas that is shielded from US taxes. Under American law, companies must pay a 35-percent corporate tax rate on global profits when that money is brought home -- so there is an incentive to keep as much of that money overseas as possible.
also to blame. Picking on Apple for this is really pretty silly. Every large multi-national company does this.
Uh, this is the most uninteresting news ever. So, you're saying that Apple has put a lot of its spare cash into government bonds, which pay out the usual government bond interest; which are actually historically relatively low rates compared to other interest rates. This is interesting why, exactly?
http://www.geoffreylandis.com
Oh good grief. That's how bonds work. That's Apple investing in the US.
Apple deserves a lot more than that!!!
So other than "the rich keep getting richer", is there a point here?
Hey, Windows users, there is no such thing as "forward" slash, there is only slash and backslash.
Hey, you can spin a financial operation both ways. Apple _lent_ money to the US gov by buying bonds. The US Gov paid interest in return.
Trump wanting to repatriation on American companies is wrong how?
They own the bonds. Just like grandma.
Far worse than Apple being given our hard-earned money, is the fact that somewhere, sometime, a real life Illinois Nazi has bought a government bond. Who knows how many DECADES we taxpayers have been paying these loathsome groups?
Clearly what the government needs to do to cut off the funds to monsters like Apple and Nazis is default on all government bonds today and declare no more will we be paying anyone these ill-gotten gains labeled with the seemingly innocent moniker "interest".
"There is more worth loving than we have strength to love." - Brian Jay Stanley
If Treasury Bonds are tax free, fine; APPL chose to use an method incentivized by tax law way to store their wealth, they followed the spirit and intent of the law. If you don't like that fight at the local level to get the changes you want, no matter how badly the system disenfranchises the local individual vs party insiders.
Using treasury instruments as investments though has little to do with laundering money in Ireland and elsewhere. But you Americans have chosen to allow this type of antisocial behavior in your tax laws, assuming that free speech campaign donation bribery allows your voice to be heard.
Seriously, is the point of this to try to make it look like Apple is taking government subsidies or something? They bought treasury notes. They get paid interest on that investment just like everyone else.
How does this nonsense make it on Slashdot?
the real problem is crony "capitalism", and it happens on both sides, its not a republican or democrat exclusive. Its not a free market when the government picks winners and losers. Say what you will about the Libertarian party but they have been talking about this issue for as long as I can remember, I just hope next time we get an opportunity to shine with two deplorable major party candidates we don't nominate a total stoner!.
Lets get some more of that 'news that matters'
And?
The real news is that we in the US can’t control our spending, and we’re issuing bonds like toilet paper to fuel our entitled attitude. And, oh, if Apple didn’t buy these bonds, who would?
Failure is not an option. It comes bundled with your Microsoft product. -- Ferenc Mantfeld
$600,000,000 / 325,000,000 US population estimate = $1.85 per person.
How did they come to $6 per?
That's Apple financing US deficits.
FTFY
The "oversea" profits are in fact, as the article said, invested right here in the US. That's because the foreign subsidiaries are perfectly entitled to make investments here. That's called free flow of capital. So why paying taxes when you're a global mega-corp? Because of an historical "community responsability" to provide jobs and pay a fair share of tax to the government? That died long ago under the heels of Reagan/Thatcher/Rubin etc.
$1,500 for a tiny laptop, $500 for a tablet, what's another $6?
I think it's a rather interesting article, but not from the slant given. Apple buys US Treasury bonds, like many companies do. The US Debt is massive, and at least this is one way we get to see the actual impact of paying this debt.
I would find it more interesting to see this tackled as a "Fix the debt" problem. The fact is, this is not a "US Tax Payers give Apple money" issue. The US pays out money to ALL treasury bond purchasers at the same rate. People with more money to pool will obviously get more in payments.
-The wise argue that there are few absolutes, the fool argues that there are no probabilities.
I've paid them a heck of a lot more than that...
#DeleteChrome
By taking advantage of a provision in the American tax code, Bloomberg says that Apple has "stashed much of its foreign earnings -- tax-free -- right here in the US, in part by purchasing government bonds."
The interest on government bonds is tax-free. The money used to buy them is what's left after paying taxes on it. I.e., the earnings were not exempt from taxes because they were used to buy bonds.
And "yawn."
600,000,000 / (estimated number of people working and paying into the tax system)
Retired, too young to work, disabled, etc.. don't pay into the tax system. I would agree if you said that the summary was wrong, because it is.
-The wise argue that there are few absolutes, the fool argues that there are no probabilities.
Government bonds don't give a very good return, and honestly at this point I start to question their stability a little bit.
So what reasons would anyone have to purchase such bonds? The fact that you could buy them pre-tax s the key, and the reason why the bonds do not have to have much of a yield to find a lot of buyers.
If you "fixed" this problem you would pretty much have to have the government start paying a much higher yield on bonds which would create an immediate cash-flow disaster for the government.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Headline should read: "Apple loans U.S. Government money"
Coder's Stone: The programming language quick ref for iPad
That's okay, with all the iPads and iPhones I've stolen I figure I'm way ahead of the curve.
Just cruising through this digital world at 33 1/3 rpm...
I've never actually bought an Apple product and I certainly don't consider myself an Apple "fanboy." However, this article is just dumb.
The actual headline should be: USA government is still able to run the ponzi scams such as SS, Medicare, all other Welfare payments as well as waging its wars thanks to Apple and others who are *STILL* purchasing and holding their bonds.
Apple is getting $6 from each individual in interest rates over *YEARS*? Think about it: over *YEARS* Apple has gained *ONLY* $6 per person while buying insane amount of US debt.
Apple is losing money in this transaction, it could have used that money much more effectively in many other ways and instead they are buying US Treasury debt.
Apple and the rest of the bond holders: what are you going to do when there is a mass exodus from the US debt? Will you be the first in line to dump it? I think you are not going to be the preferred seller.
You can't handle the truth.
tax evasion schemes. This is not one of them. I often wonder if these sorts of stories are an attempt by mainstream media to go after 'safe' financial targets. They can't do real journalism against our corporate overlords because, well, those are their bosses. Hell, look what happened to Gawker when they went after a member of the ruling class (Thiel, not that jerk Hogan). Dead before they hit the ground, I tell ya.
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Apple is losing money in this transaction, it could have used that money much more effectively in many other ways and instead they are buying US Treasury debt.
If that is true, then Tim Cook is incompetent.
Any US taxpayer and corporation that buys US Treasury bonds has the same exemption in the US. Also, in most US states the interest from bonds issued by the state are also tax exempt. Who cares?
What I would like to know is how much of the US debt would be offset by Apple not paying corporate taxes. What is the interest paid on that amount? This is part of the real damage that Apple is inflicting on US citizens.
retard - government bonds are the risk free interest for when all other options are maxed out for their risk
I got two OS upgrades without W10 for that $6. I would love to know how much other companies 'charged' me.
Oh yes apple has big oproffits and theair well paid accoubants/loyers minimce the tax bill, boho. I know it's kind of populare to atack Apple but as long as the have followed the law, the criricisem shuld be pointed at dc
Legally avoiding taxes is not the same thing as tax exasion. If you don't like it take it up with Congress and the tax code. Apple would be stupid not to take advantage of a perfectly legal financial situation.
Do you understand how buying bonds works? You do know it is an investment in our country, right? Apple gave our country an incredibly large loan at a great interest rate.
And as far as the money overseas - they made that on overseas sales and have already paid huge taxes on it. They don't want to pay it twice, would you? It is the same thing that every other corporation does, so why are you singling out Apple? They at least offered to bring their foreign earnings into the country if they could pay a reduced rate, but the US government doesn't want to do that. You really need to quit whining about Apple. You are making yourself look silly.
retard - government bonds are the risk free interest for when all other options are maxed out for their risk
- retard is he, who believes that government bonds are risk free rather than being most risky assets today, in a country that lives on borrowed time.
You can't handle the truth.
Okay, what is going on /.?
I come here to read my tech news because it's always been less political and less troll-y than other sites. But.... over the past year some of these clearly biased/uninteresting/weird things have been posted and... I'm just so confused.
Quick look over at HN and I see a story about how patents are getting limited (https://www.eff.org/deeplinks/2016/12/supreme-court-curbs-excessive-design-patent-damages) or maybe Windows 10 coming to ARM chips (http://www.theverge.com/2016/12/8/13881930/microsoft-turn-a-phone-into-a-pc-arm-continuum)
That is nerd news.
What the hell is this shit?
Since Obama was spineless, maybe Trump can do something here.
I think the point is that Apple has effectively repatriated their earnings into the next best thing to US dollars, and done it without paying taxes.
It was one thing when they hoarded cash overseas without repatriating it, at least in some ways they were exposed to some kind of foreign currency risk. But since they've bought Treasuries with it I think to a lot of people it feels like they're beating the system even further.
For comparison purposes how much interest has been paid to Chinese bond holders? In any case if the public tax burden is too onerous the US can always print more dollars - apparently Trump's position.
I love the way people try to insinuate that a multi-national company who earns money overseas but didn't pay US taxes on that money is cheating somehow. What is next? Apple sold an iPhone in California and DIDN"T pay New York sales tax on it???? That must be criminal, right?
The US government repays the bonds with money that it creates out of thin air. The US taxypayer is out nothing except the dilution of their dollar caused by inflation.
Site your source.
All of these are American companies benefiting from our infrastructure, workers, consumers, defense, etc.
Why aren't they simply being made to pay? Close bullshit loopholes. They want to move all their shit somewhere else? Great. Let them be a parasite on some other country.
Um no. US bonds define safe investment. To not get paid you'd have to believe that the US government would default on its debt and not have assets to cover the loss. The US National debt is a very small % of US GDP, so they have the money through taxation fairly minimally. The US federal government also owns about 1/3 of the land inside the country which would easily has more value than its debt. That's not counting all the other assets the US government has or has rights to that could be sold off.
Oh good grief. That's how bonds work.
Amen. That's exactly what I thought when I read the details of this (non-) "story".
The US government has chosen to offer these bonds for its own reasons. One might argue whether the government should be raising money this way, but they (presumably) chose to do that and offer enough of a payout to make it worth investors' time and money.
As you said, that's how it bloody works! Apple just happens to be one of the companies that has taken them up on that.
There's plenty to criticise about Apple, both with their overpriced, walled garden devices, and how they manage their tax (dodging) affairs, but to contrive their investment- and ignore everyone else's- in government bonds that are specifically *meant* to work like this as a "story" is obvious clickbait BS.
"Slashdot - News and Chat Sites Deviant". (Click "homepage" link above for details).
This would be called false.
what a stretch. That's like saying Apple stole breathable air from everybody in the USA.
Who cares?
And by the way, they still need to fire Tim Cook.
They pay interest. It's not much interest, but it is some. So basically Apple is propping up the finances of the US Government. And it's their fault.
How about a moderation of -1 pedantic.
No, US bonds are the definition of ponzi scam that even Madoff would be awed by. U S A cannot return the borrowed VALUE of the money, that is what the Fed and the rest of the central banks are involved in, global inflation, writing off the debt without admitting the technicality of the default. The actual USA debt is all of the federal, state, municipal, corporate and personal borrowing that exceeds 221 trillion dollars and cannot be repaid under any circumstances.
You can't handle the truth.
The article headline is complete Clickbait trash. How about a title that points out the American taxpayer is probably paying around $50 a year per person to the Chinese government. When you buy US treasury bills you get paid interest. Last I read the Chinese have about $1 trillion worth.
US government bonds are 100%, totally, risk free. The US fed can create $ from thin air, and are the only body in the universe that can do this. So, there is zero risk.
Don't you normally pay interest on money you loan to people? I don't see any there there.
Yeah, I say! Race to the bottom! What the fuck we do need taxes for anyway? On the contrary, the government's job is NEGATIVE taxing: squeeze from the poor (they're dumber and should be evolved-out anyway) and give to the rich (they're smarter and deserve to survive and procreate).
Or something like that.
Now excuse me while I go to the restroom to have a barf.
I have never paid Apple a single dollar.
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how much taxpayer money went to fund: solyndra and other clean energy companies that went to waste? aig gm fiat/Chrysler etc
nothing to see here - move along
If it's true then US taxpayers effectively subsidised my iPhone. Thanks guys!
Apple owes BILLIONS of dollars in unpaid and illegally avoided taxes to the US. They should not be allowed to collect interest on the treasuries they hold while they owe this money.
Any American who owes back taxes is garnished any federal payouts until their back taxes are paid. The same should be true of megacorporations who evade US income taxes through illegal tax avoidance schemes.
If we just stop spending more money than we collect.
Is it just my observation, or are there way too many stupid people in the world?
and you dont get a product that makes you look like a faggot from a faggot sect, its not really that bad
just saying
So, there is zero risk.
- :) You are being sarcastic I hope, I had a great chuckle (for real) reading this, hopefully you were smiling while writing that, yes?
The only 0 risk in buying government bonds is this: risk of getting back the value of the money you bought the bonds with.
You can't handle the truth.
are there really that many people who have never seen "The Blues Brothers?"
Seriously. I was also despairing as I read the responses to your post!
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Apple deserves no blame for earning interest on bonds that they purchased. The problem is the unethical profit offshoring to hide from the equally unethical 35% corporate tax rate, which is really just a tax for small businesses since large businesses do exactly what Apple is doing. Tangentially, if the U.S. didn't need to sell so many bonds to pay for their deficit spending this wouldn't be happening in the first place.
TLDR: The problems here are 1) the government's additiction to debt and 2) offshoring profits to protect them from the 35% corporate tax rate, among the highest in the world. Earning interest from purchased bonds is totally fine.
I think the story was pretty poorly framed. The interesting part is that the bonds are being purchased with profits that were held offshore to avoid paying corporate income tax. This scheme is possible because of the government's deficit spending and all of the bonds that they must sell off to create the new debt.
Yes, you are right. The story goes a bit deeper though. Apple is buying government bonds to repatriate the profits that they held offshore to protect them from the US corporate tax rate (35%). Overall it's bad for the government since if Apple just paid the taxes it would increase the government's tax revenue and they wouldn't have to issue so many bonds in the first place. Still, it's better than just keeping the profits offshore since at least they are keeping the government solvent by buying their crappy bonds.
That's US deficits financing Apple.
Ergo, the solution is PAY DOWN THE F*#@*$ DEBT.