“Does Apple really pay its fair share of U.S. taxes?” Kathleen Pender asks for The San Francisco Chronicle.
“In a Nov. 3 report, Citizens for Tax Justice estimated that Apple paid an average effective U.S. tax rate of 31 percent between 2008 and 2010,” Pender reports. “That is close to the ostensible corporate income tax rate of 35 percent. Out of 280 companies in the study, only 49 had a higher effective tax rate than Apple.”
“But in an overlooked report published in the journal Tax Notes in August, economist Martin Sullivan said Apple is no better than other multinationals that have been ‘painted as corporate tax dodgers by major media outlets,'” Pender reports. “He said that ‘despite outward appearances, Apple enjoys enormous foreign tax benefits, just as GE and Google do. By taking advantage of lax U.S. and foreign tax laws, Apple has been able to book a large share of its foreign profits in low-tax jurisdictions and greatly reduce its tax liability in the United States and other major countries where it conducts most of its real business activity.’ He estimated that by shifting profits overseas, Apple is costing the U.S. government more than $1 billion a year.”
Pender reports, “Can both of these reports be right? The answer is yes and no.”
Read more in the full article here.
MacDailyNews Take: What Apple and basically every other company worth their salt are doing is legal. If you don’t like it, work to change it. With an incredibly complex tax code, riddled with loopholes and written by lobbyists, how much is the U.S. government costing the U.S. government per year? Exponentially more than a mere $1 billion, that’s for sure.
Related articles:
Senator John McCain eyes Apple’s $54 billion overseas cash pile – November 3, 2011
Google joins Apple in push for U.S. repatriation tax holiday – October 3, 2011
Apple lobbies Obama for tax holiday, wants to bring overseas bounty home – August 24, 2011
U.S Senate Democrat Schumer allies with Apple, other multinationals on repatriation tax talks – June 21, 2011
U.S. companies push for tax break on foreign cash – June 20, 2011
Apple, Oracle, Duke Energy, others organize lobbying blitz for tax holiday – February 17, 2011
Remember, if a company (say GE) doesn’t pay much if any taxes, it’s not the company’s fault. It’s the fault of the politicians and the obtuse tax code.
Lower the corporate tax rate, make it fair, and let companies like Apple repatriate foreign money.
All of the above would help the economy.
GE and others have all poured millions of dollars in lobbying efforts to create and protect these tax loopholes. GE is a joke. They have dreadful un-American policies and yet Obama has him on his economic and jobs council.
It’s not simply the politicians. It’s the entire package:
→ corporations funneling money through lobbyists;
→ unrestricted, unlimited, secret campaign financing;
→ electioneering that requires a “billion dollar war chest” to successfully run for a national office;
→ politicians in the lobbyists’ pocket due to the above
→ an uninformed public that champions sound-bites, rather than fact-checking
→ hyperpartisanship that refuses any compromise
and the list goes on and on and on and on …
Bingo
Since bribing (lobbying) politicians is legal in the states, it’s no wonder they’re in the shape they’re in. It’s corruption at it’s finest and I don’t see it changing anytime soon
That’s why the US tax regime is overtly complicated and broken. The tax system is supposed to be easy to understand for everyone but the politicians and the lobbyists make it as as abstruse and opaque as possible. It is the gravy train of corruption for politicians to ride on.
This is the worst pro-Apple explanation I have read on Macdailynews…
Like MDN stated so concisely: “If you don’t like it, work to change it.”
America’s tax code is broken. Here’s how to fix it:
http://www.rickperry.org/cut-balance-and-grow-html/
Please, this is just empty rhetoric without any hard numbers or details. For example:
“By 2020, America must have a tax code that is simple and fair; a federal budget that balances without raising taxes; retirement and health care programs that are sustainable and secure; a common-sense regulatory system that does not create undue burdens on job creators; and a growing economy that allows the best and brightest to create and innovate free from government intimidation.”
First of all, by 2020? That is setting the bar low. Second, a tax code that is simple and fair”? Sure, I agree, except that there is no definition of what “simple and fair” means in Perry’s world. And “a federal budget that balances without raising taxes”? That is the GOP dream that is always based upon unrealistic economic growth that somehow overcomes the loss of tax revenues through tax cuts while avoiding cuts in defense spending. Come on Perry – identify the specific cuts that you would make to achieve this nirvana of pay less and still balance the budget. What *specific* cuts do you intend to make? Hopefully it will turn out better than in Texas. I live in Texas, so I have first hand experience with our worthless secessionist governor.
A “common-sense regulatory system that does not create undue burdens on job creators”? Who can argue with that? It is exactly what everyone with a brain wants. Is Perry implying that his adversaries are striving for a “ridiculous” regulatory system that places as much burden as possible on “job creators”? That is laughable. What Perry means is do stuff like W did – for instance, declare it legal to dump strip mining waste into the Appalachian valleys and destroy ecosystems, water supplies, and communities.
Don’t steer me towards meaningless drivel, Mr. Fixit. I want to debate serious, detailed policy options based upon analysis. Fluffy campaign rhetoric such as this is worthless. And I refuse to vote for any candidate that is clearly out of touch with legitimate science.
“Please, this is just empty rhetoric without any hard numbers or details.”
Yep! Right up there with “SAVED OR CREATED” regarding jobs numbers!
I assume that you are counting the jobs numbers since Jan 2000?
Ever talk to a 1% about tax laws? They can spend hours talking about it, the same way regular people talk about cars or computers or sports.
maybe cause 50% of the people do not pay any taxes…
and the top 1% pay almost 40% of the tax bill.
the current tax code IS screwed up.
That dog won’t hunt.
The current tax code is screwed up, BUT:
50% of the people do not pay any income taxes because they don’t have enough income to be taxed.
They still pay payroll tax (if they’re lucky enough to have a job); they pay sales tax; they pay utilities’ taxes on phones, electricity, water, etc.
they don’t pay the income tax, but are the beneficiaries of all the 1%’s taxes.
as has been showed before, even the poor in the US are not exactly “poor” when you look at the entire world.
http://www.heritage.org/research/reports/2011/09/understanding-poverty-in-the-united-states-surprising-facts-about-americas-poor
the bottom 50%, are more whiners than anything.
you have no idea what you’re talking about, FTB.
would you feel better about yourself if the American Poor had flies buzzing around their faces and bloated stomachs? Bet that’s make you feel REAL GOOD, huh?
So many obvious problems with that idea.
There’s an obvious ethical problem with taking money from people with no money. It’s cartoonist villainy. You need a black cape and mustache if you are looking at homeless shelters and soup kitchens and seeing potential revenue streams.
But even more obviously, there’s an economic problem with taking money from people with no money: they don’t have any money to give you. For a short-term gain of a handful of pennies, you are taking money from people who can barely afford the essentials for living, which puts them in living hell, and putting people in living hell makes them less productive and hurts the economy long-term.
@ Figurative … I agree with you 100%.
@ Figurative. Amen!
The article is technically correct. It would be a crock to allow all of these companies a tax break to bring back income that was generated in the US but never taxed here!
As a middle income person, I’m truly tired of being screwed over by every corrupt corporation out there. If the US gov’t doesn’t deal with reducing the influence of special interest groups, the occupy “whatever” city will look like a tea party compared to what’s coming down the road.
We start by getting rid of that dumbass in the White House. Worse than Jimmy Carter, and that’s saying something. This is what happens when you elect a dumbass community organizer that never ran anything in his life. America gets exactly what it elects, and now look what has happened to you. This moron is ruining the US economy with his cluelessness. Send that fool back to Kenya.
you are the biggest bigot any one has seen!!
What do you expect from a government that decides pizza is a vegetable.
I saw that the other day…
So i’m off to order a Pizza! get my daily dose of Vegetables, now why am I so fat though?
Everyone whines and complains about tax breaks, except for when someone proposes taking away THEIR tax breaks.
Paying your taxes is a game, just like any other game. The better you know the rules (the tax code and court decisions), the better you can play the game and the more of your money you can keep. Anyone who pays too much in taxes is either not trying or just plain dumb.
Those supposed millionaires who went to the White House to ask for higher taxes were simply staged or put up to it. All they have to do to pay more taxes (IF they really want to pay more) is to stop taking deductions permitted (but not required) by the Tax Code. Higher Taxes, Done!
Higher taxes is not the answer to our government’s debt problems. Congress will simply enjoy spending more money, and we’ll still be in our current situation, only the numbers will be larger. Without serious (and probably painful) cuts in spending (in ALL areas, and yes, that means Medicare, Medicaid, and SS are going to have to cut back on their pyramid plan payouts as well), combined with reduced borrowing of money, this debt will never go away.
exactly.
and everyone fails to remember that there IS a way to pay more in taxes voluntarily if you want. it’s called a “gift”
all these whiners that run out there and say “Please raise my taxes” are saying it for political gain. nothing more.
here, for all the “raise my taxes” crowd.
http://www.fms.treas.gov/faq/moretopics_gifts.html
there’s your way to pay more.
Last I checked, the 1% can still make their checks out to the U.S. Treasury. I’m talking to you, Mr. Buffet.
Wrong!
Just buffet by himself is not going to do it. It requires a wholesale change in the law so that everyone complies. Like a first world country…..not like some sort of optional charity thing. Of course you should know that…..shouldn’t you? Your “last I checked…..blah blah blah” mentality makes me sick!
I don’t understand how my comment, that was directed at an outspoken proponent for taxation of people other than himself, was also denying the need for sweeping tax reform. Smooth segue, bro.
Paying taxes is a game, and that’s the problem. Taxes fund services that everyone benefits from: infrastructure, education, defense, research. Everyone gets something from these services, so everyone should pay fairly. But how can people pay fairly when the amount they pay is based on a crazy game with exploitable rules? As it is now, the tax code is a game, and the rules are written by those rich and corrupt enough to buy lobbyists and politicians.
A few people voluntarily paying more taxes won’t fix things. You seem to have missed the point. Everyone needs to work together and make the necessary sacrifices and compromises to get things back into balance.
This is exactly the problem that I have tried to address in other posts. It is easy to say “balance the budget with spending cuts without cutting defense spending and without raising taxes.” It is, in practice, essentially impossible to do so, especially at the lower tax rates and capital gains rates established during the past decade. Do you truly understand the position that you are defending and the consequences that it will have for this country?
So, a reporter in ‘Frisco thinks Apple has too much money.
Surprise, surprise, surprise.
31% is a big chunk of change, considering what Apple makes each year.
The home mortgage deduction is the biggest tax break around.
They pay an obscenely disparate amount compared to the lazy, gimme mo low lives who pay nothing! About 50% of households last I heard! Pass out the pampers, cuz Obama’s America is turning into a giant crib at the expense of people who actually work and pay taxes!
I agree with iMaki. I think we need a political system like that of a century ago — where we had none of this namby-pamby shite of this modern milquetoast society. People lived and died by their work — and if that means children working 7 days a week/14 hours a day again, that is fine with me. We also don’t need them damn regulations to stop me dumping highly toxic waste, or selling people cancer sticks. Market forces will take care of my poisoning vast numbers of people. We only have to look at some other countries where there is no social safety net and much less regulation to see how great the US could really be. (Ah, no, on second thoughts, don’t look at those other countries. Maybe I shouldn’t have said that.)
——-
It really is striking how the right wing’s ranting (here and elsewhere) is often empty of logic while being full of a vitriolic hatred that brings to mind an inflamed puss-filled boil — while those who argue against them usually present actual thoughts, logic and evidence. (my post being an exception to the latter)
iMaki, there are some people who shirk work and are a burden on society. They exist at all levels of society, actually – a number of them inherited wealth. But that is beside the point.
The 50% who pay nothing, as you say, have relatively little to give. By gathering and hoarding a disproportionate amount of wealth in relatively few hands, it follows that taxation will be similarly imbalanced.
Please note that I am not a fan of this “class warfare” BS. But the middle class in the U.S. has been decimated, and that is reflected in tax revenues and other economic data. Profits are being maximized at the expense of labor – reductions in or elimination of health care benefits, poor or nonexistent retirement plans, etc. It harms everyone, including the wealthy because that pile of money in the bank won’t be worth anything if the economy goes to heck, and neither will stocks or gold or fancy cars.
I do believe in capitalism. But I don’t believe that capitalism should be synonymous with greed.
MDN: “… how much is the U.S. government costing the U.S. …”
Bingo, there’s the real problem!
Without the U.S. Government, there is no “U.S.”
Bingo, there’s the flaw!
I read the story, it’s pathetic. There’s no there there.
What is this morality that’s been suddenly assigned to taxes? Apple’s “fair” share is the same as any other corporation, and is defined as: “the minimum amount they can legally pay”.
On the macdailynews take … Amen broth!
The sentiment of the take is spot on, but the math is wrong.
They say that problems with the US Tax costs “exponentially” more than “$1 billion”. The smallest exponent of a billion is a billion squared, or a quintillion (1 followed by 18 zeros). The US Tax system might be inefficient, but there’s no way it wastes a quintillion dollars, several times more than the amount of US dollars in existence.