Re:How Apple Avoids Paying Billions in Taxes
by Blara on Monday November 05, 2012 @02:03AM
(#4742553)
A better headline would be "How insert multinational coprp avoids paying billions in taxes"
I'm no apple fan, but this is the norm for most (all maybe?) big corps.
Re:How Apple Avoids Paying Billions in Taxes
by stock_toaster on Monday November 05, 2012 @01:25AM
(#4742474)
I wonder why Ireland doesn't change their "if the Irish subsidiary is controlled by managers elsewhere, like the Caribbean, then the profits can skip across the world tax-free"[1] law. If so many huge corporations utilize the tax loophole, you would think it would be in their interest to tax that at least somewhat.
Re:How Apple Avoids Paying Billions in Taxes
by Centigonal on Monday November 05, 2012 @01:07AM
(#4742418)
Oh man, the math behind this stuff must be fascinating -- designing a system to shuttle money around while minimizing latency and tax rates would be so much fun.
The economic/ethical implications of what Apple and others are doing according to this article are considerable and worrying, but all I can think of right now is some kind of sim-tax-evasion game.
Re:How Apple Avoids Paying Billions in Taxes
by taligent on Monday November 05, 2012 @01:17AM
(#4742457)
What math and what system ?
It is simpler and easier the way Apple does it now. Money originates in each country that a sale is made some of which flows into the regions e.g. Americas or APAC. It would be much harder to be constantly moving money in and out of the US.
Re:How Apple Avoids Paying Billions in Taxes
by tzs on Monday November 05, 2012 @01:26AM
(#4742476)
Most of those services are local services paid for through property taxes, which I would expect they pay just as much as any other land owner pays directly or renter pays indirectly in any areas where they own or rent.
Re:How Apple Avoids Paying Billions in Taxes
by whazor on Monday November 05, 2012 @06:45AM
(#4743061)
The society let them get away with this because the earnings are outside of the USA. If they do need to pay taxes for outside earnings then the company will just move to an other country.
Re:How Apple Avoids Paying Billions in Taxes
by taligent on Monday November 05, 2012 @01:15AM
(#4742451)
The amount of stupidity in this article is startling.
There are plenty of legitimate and common sense reasons for why Apple would keep much of their overseas earnings overseas. There are financial reasons e.g. minimizing wasteful forex conversions. There are legal reasons e.g posting collateral for court cases or tax disputes. There are logistic reasons e.g. having money on hand to make it easier to acquire companies or hire new stuff.
If Apple really wanted to avoid paying taxes then they are plenty of ways they could do this. But they DO pay taxes. Just not US taxes for non-US revenues.
Re:How Apple Avoids Paying Billions in Taxes
by paulsutter on Monday November 05, 2012 @02:25AM
(#4742594)
Your criticism may be better directed at those who write the laws, not those who follow them.
It's not only the norm, it a company's fiduciary responsibility to minimize tax liabilities. If these activities are against the intent of the law, a simple rule change should suffice.
Re:How Apple Avoids Paying Billions in Taxes
by ljf on Monday November 05, 2012 @02:39AM
(#4742623)
Indeed, I personally believe that many corporations in the UK should pay more in tax - with less loopholes to escape from paying tax. But shouting at businesses isn't going to change anything, only shouting at politicians is going to to do that.
It seems though the only way to mobilise people to do this is to outrage them with the disparity between how they have to act and how companies are allowed to act.
As an aside, UK manufacturing is tiny, but from 2000 onwards , taken as a whole, has paid more in corporation tax than the entire huge banking system.
Re:How Apple Avoids Paying Billions in Taxes
by clobber on Monday November 05, 2012 @03:37AM
(#4742739)
I certainly can't blame a company for taking advantage of existing loopholes and we should challenge our lawmakers to close said loopholes. However, I can question their ethics, stock market be damned.
This whole "it was my duty" mentality and shifting the blame... hmm, now where have I heard that before?
Re:How Apple Avoids Paying Billions in Taxes
by paulsutter on Monday November 05, 2012 @04:31AM
(#4742835)
If the behavior is unethical, what exactly would be the correct and ethical way for these companies to calculate their taxes? If it's so cut and dried for you, maybe you can help us all out here.
You call it a loophole, suggesting that there is a design flaw in the law that is being exploited. What specific part of the law is flawed, and what was the drafting intent that has been misapplied in the law as it stands?
I'm really serious. It's disappointing to me that so many people are ready to assume unethical intentions, when the details and issues are far from clear to me (and likely not clear to them). Maybe there is a country that has done it correctly?
Accounting for business in multiple tax jurisdictions is really complex, and I can only assume that we had some really thoughtful people drafting the existing laws.
Re:How Apple Avoids Paying Billions in Taxes
by 2buckchuck on Monday November 05, 2012 @01:10AM
(#4742430)
its despicable that companies like Apple reap enormous rewards and take advantage of American infrastructure and consumers, but don't have the decency to pay their fair share of taxes. I'm not a lover of taxes or the American government, but I think that successful corporations (and people) need to give back to the countries in which they operate.
Re:How Apple Avoids Paying Billions in Taxes
by buro9 on Monday November 05, 2012 @01:51AM
(#4742527)
Are those taxes that Apple paid because they were taxes on Apple as a corporate entity, or taxes paid by Apple onbehalf of its' employees who were being taxed on their income?
I don't believe that there is an accusation that the workers at Apple are avoiding tax, but that the company is avoiding tax.
Re:How Apple Avoids Paying Billions in Taxes
by buro9 on Monday November 05, 2012 @02:22AM
(#4742587)
Ah, my ignorance of US financials comes through then... so there is no US equivalent of the PAYE system or a withholding tax to ensure non-avoidance by employees?
When tzs refers to income tax, that traditionally means personal/employee income in the UK whereas corporation tax is the tax on profits levied to corporations.
Hence, tzs's statement above reads as if Apple did pay income tax on behalf of their employees, but makes no mention of corporation tax or an equivalent.
Too many similar terms used differently from one place to another. Now I understand the downvote.
Re:How Apple Avoids Paying Billions in Taxes
by sk5t on Monday November 05, 2012 @02:36AM
(#4742613)
Tax witholding for salaried employees is entirely normal and customary in the US, but the article is not about those individual taxes, and US taxpayers wouldn't ever describe the taxes as being paid "by" the employer on employees' behalf.
Re:How Apple Avoids Paying Billions in Taxes
by stock_toaster on Monday November 05, 2012 @01:30AM
(#4742485)
Large companies even do it at the state level too. see[1] for an example of using an office in reno to avoid some (I don't think you can avoid some taxes like payroll, etc) taxes in California.
[1]: http://www.nytimes.com/interactive/2012/04/28/business/Doubl...
The economic/ethical implications of what Apple and others are doing according to this article are considerable and worrying, but all I can think of right now is some kind of sim-tax-evasion game.
It is simpler and easier the way Apple does it now. Money originates in each country that a sale is made some of which flows into the regions e.g. Americas or APAC. It would be much harder to be constantly moving money in and out of the US.
They are benefiting from all the social services regular citizens are (police, roads, water, public schools, etc.) without paying for them.
This is robbery. They are robbing America's future.
If they stopped selling internationally, would you say it is no longer robbery?
Who is "they"? Apple employees? They're paying lots of taxes.
There are plenty of legitimate and common sense reasons for why Apple would keep much of their overseas earnings overseas. There are financial reasons e.g. minimizing wasteful forex conversions. There are legal reasons e.g posting collateral for court cases or tax disputes. There are logistic reasons e.g. having money on hand to make it easier to acquire companies or hire new stuff.
If Apple really wanted to avoid paying taxes then they are plenty of ways they could do this. But they DO pay taxes. Just not US taxes for non-US revenues.
Sadly, this is the 'norm' for many, many corporations - including Google.
It's not only the norm, it a company's fiduciary responsibility to minimize tax liabilities. If these activities are against the intent of the law, a simple rule change should suffice.
It seems though the only way to mobilise people to do this is to outrage them with the disparity between how they have to act and how companies are allowed to act.
As an aside, UK manufacturing is tiny, but from 2000 onwards , taken as a whole, has paid more in corporation tax than the entire huge banking system.
This whole "it was my duty" mentality and shifting the blame... hmm, now where have I heard that before?
You call it a loophole, suggesting that there is a design flaw in the law that is being exploited. What specific part of the law is flawed, and what was the drafting intent that has been misapplied in the law as it stands?
I'm really serious. It's disappointing to me that so many people are ready to assume unethical intentions, when the details and issues are far from clear to me (and likely not clear to them). Maybe there is a country that has done it correctly?
Accounting for business in multiple tax jurisdictions is really complex, and I can only assume that we had some really thoughtful people drafting the existing laws.
Similar for the other companies mentioned in the article. For instance, I believe Google paid around 20%.
I don't believe that there is an accusation that the workers at Apple are avoiding tax, but that the company is avoiding tax.
When tzs refers to income tax, that traditionally means personal/employee income in the UK whereas corporation tax is the tax on profits levied to corporations.
Hence, tzs's statement above reads as if Apple did pay income tax on behalf of their employees, but makes no mention of corporation tax or an equivalent.
Too many similar terms used differently from one place to another. Now I understand the downvote.
[1]: http://www.nytimes.com/2012/04/29/business/apples-tax-strate...