“Apple Australia chief Tony King has vehemently rejected suggestions the technology giant has employed ‘strategies’ to reduce its tax rates in Australia,” Fran Foo reports for The Australian. “Both Apple and Google have been under the spotlight for allegedly avoiding paying the full amount of tax based of profits gained in Australia.”
“Today the tech giants appeared before a Senate inquiry into corporate tax avoidance in Sydney, where they and Microsoft confirmed they are being audited by the Australian Taxation Office,” Foo reports. “The inquiry heard Apple Australia paid $80 million in tax last year despite revenues of $6 billion. It posted a profit of $250m. Mr King said Apple is taxed on profits and not revenue and that Apple pays ‘all of our due taxes in Australia,'”
“Citing media reports, South Australian senator Nick Xenophon asked Mr King to confirm if Apple had previously sent $9bn in untaxed profits to Ireland,” Foo reports. “‘No, we haven’t shifted any profits (overseas),’ Mr King said. Earlier, in his opening comments, Mr King said Apple ‘pays all the taxes it owes, in accordance with Australian law.'”
Read more in the full article here.
MacDailyNews Take: Legal.
There are many disappointed agenda-driven Apple dissenters down under today undergoing a painful realitydectomy.
Lots of them came here to down vote, hold crap!
I hate spell chech: holy.
I kind of liked “hold crap.” Has a ring to it, you know.
Let them down vote! ‘Tis true. The reality of every company trying to be taxed as little as possible within the law holds fast. You want something different in your country then change the rules. Just don’t forget there may be undesirable & unforeseen consequences.
Tax law thought up by a few people on gov’t salaries versus 100s of tax avoidance (sorry legal minimisation) experts who get 7 figure bonuses finding loop holes. Every country has this problem with large international companies. Change the law? Not if the political donations from these companies might stop.
My son tronny has found out a trick to down vote those he thinks hurt his feelings. He is angry because he has been grounded for a week and won’t get his weekly goat to gnaw on. Forgive him because he is truly clueless.
While intuitively the profit level seems low, since sales are $6B, I would imagine that most of Apple’s international profit is from Apple Intl selling wholesale product to Australian retailers, which means the profit is outside Australia, wherever Apple Intl is located, presumably Ireland. The $80M in tax is presumably from Apple’s retail sales operations in Australia.
The disconnect is probably that Apple is not selling $6B in product, but a much smaller amount thru its own stores.
Apple is known to have profits on revenue of about 40-60%? Something fishy with the maths.
It’s straightforward.
Apple buys phone from Foxconn for say, $350US [completely made up]. But the business buying it is “Apple Bahamas”, a subsidiary. The phone is shipped directly to Australia, where Apple Aussie buys it from Apple Bahamas for, say, $500US. The details are way crazier complicated than this, but it’s basically how it goes [between this direct pricing manipulation and patent fee’s paid between subsidiaries].
So, Apple gets to control exactly which countries get which percentage of the ‘profit’ of any given device.
Problem of having so much cash hoarding, therefore, everyone is drooling over of Apple’s pile of cash.
Some of which (they presume) is located at the end of an Irish rainbow?
Not just Apple. See other articles about Microsoft, Google, News Corp (owned by an expat), and many large Australian companies. Can’t change the law because local jobs might disappear overseas so these companies say.
If governments want to make sure that the level of tax that corporations pay in their country is correct then legislate so it happens.
Bitching and moaning that loopholes exist so that corporations is not good enough. The politicians will have to deal with the backlash from the lobbyists when they close the loopholes.
Here, the loophole is that corporations pay tax on profit; not revenue. How are you going to “legislate” that?
They are not “bitching and moaning” as you say. There is a government inquiry by elected politicians into a group of multinationals and their taxation arrangements. If the inquiry finds that changes are required, then those necessary legislative changes will be made. It’s called democracy. If any company or individual is happy to use the roads, the water, the medical system, the rule of law, etc, to sell products or services into a country, then these services don’t come free and they are expected to pay their fair share of tax to pay for them. This inquiry will go some way to determine if these multinationals are paying their fair share.
That’s also what they did/are doing in the UK with their ‘diverted tax’. Apple [and all the other companies using these tax dodges] are complaining about it and going “oh no, it’s too much. instead, you need to work on reforming the tax code ON A GLOBAL BASIS, then we will be ok with tax changes”.
Course, that’ll only take 20 years or more to happen…
While Anustralians are about the only ones that make Americans look good that culture is a blight upon the earth.
And like clockwork, if the article mentions Australia this peanut sticks his head up to remind everyone of what an idiot looks like.
I think in this context, the term you’re looking for is “drongo”?
“comments from the peanut gallery” is a saying that comes to mind……
And as per usual I’d much rather be an idiot than a fecal filled anustralian.
Road Wanker more like it! You hit the nail on the head Luke, some Aussie must have kicked his train set over when he was a kid and he just can’t forget it.
You’re welcome back any time mate. I’ll even buy you a beer and protect you from the nasty locals. Smooches!
I’ll keep that in mind Luke. Which pub? I do like that Cooper’s pale ale.
We’ll find somewhere good. You’re right about the Coopers too. You used to be able to get their sparkling ale in the government bottle shops in BC, not sure what’s available now though.
BC? British Columbia?
So where is this pub we’d go to. I haven’t been to Perth (hear it’s nice) or Alice Springs yet.
Yeah, you’re Canadian aren’t you?
Perth is full of idiots, and Alice is pretty much just a stopover on the way to the rock or kings gorge.
Yes, I am Canadian, there is more than BC here, a few more states more. Sounds like you were part of the Whistler crew when you came over (more Aussies in Whistler than anywhere else in Canada).
I guess you’ve had some of our fine beer as well.
Perth is full of idiots? Dang Luke that’s shattering, we’ll have to find some place else to drink beer.
Adelaide would be better for wine. Hmmm wait, I haven’t been up to Cairns yet…maybe there.
Anyway this thread is getting long, let’s pick it up next time I make an Aussie comment. I have refrained for a bit.
Incidentally, there’s currently a review happening into the entire tax system in Australia. The existing system is a total mess.
While I don’t like multinationals avoiding tax, I can’t blame them! I expect any company to do everything it can to minimise its expenses, including the tax bill. It’s the tax system that’s the problem.
Everybody wants a piece.
Maybe the Australian Government would prefer to have Apple pull all their business out of Australia and collect “$0” tax dollars from them.
Better to get your fair share of something other then a whole lot of nothing. These greedy politicians better figure that out.
What an idiotic comment, Observer. Many countries are grappling with the same problems with a group of multinationals, not just Apple. Legislators are now trying to catch up with new forms of profit shifting. Just because Apple, Google, Microsoft Amazon etc make desirable products (well, maybe not Microsoft 🙂 ), doesn’t mean they are good corporate citizens. Personally, I don’t like paying more and more tax as an individual to make up for the hole in the tax base left by corporations not paying their fair share. Maybe you enjoy handing over more tax than you need to as you mindlessly defend every action of your favourite consumer brand.
Really? On $6 billion in revenue, Apple makes $2 billion in profit from Australia’s consumers. You are saying that:
1) Australia is lucky to even get $80 million of it
2) Apple should forgo the $2billion in profit unless they get all of it.
You clearly are one of those idiots that believe in trickle down economics. Because it’s definitely just a trickle.
this is what happens when instead of running the business ceos go whining to politicians about paying taxes.to any investor out there, when the first thing a new ceo does is fire people sell your shares, this person has no ideas, no new products, no new innovative services in mind. ask radio shack. ask sun. ask microsoft. anybody can eliminate jobs, it doesn’t take someone making 10 million dollars to do that. anybody can give money to politicians for a tax break. again not worth 10 million in salary.
look at it this way, once they get the tax break, once they have fired a bunch of people, now what?
they should stop trying to buy votes, that’s several million right there, they clearly don’t need 1 million to live and raise a family, and enjoy life. their employees don’t have that and they seem to be getting by. plus as a stock holder i want my profits sent to me. companies should have to pay 80% of their profits to share holders, you know, the people that own the company. there is no need to incur debt to keep them hungry, as these coes try to make us believe. think for a second, if that’s really good for a company it should be good for a government.
if these coes what to make 10’s of millions buy stock, and get it from the dividends. that will keep every body hungry.
Politicians are the greediest people on the planet. They can never take enough of others’ hard earned money.
That’s because politicians delusional believe that what you earn is theirs to spend for their purposes. Political rulers are and always have been the real robber barons.
Jesus George, are you even old enough to vote? When will the stupid comments on this forum ever stop? Do you even know what this topic is about?