U.S. Senator 'livid' about Apple's U.S. tax dealings
When asked about Apple's supposed "sidestepping" of U.S. tax laws, Senator Tom Colburn (R-Okla.) said that he was "livid about that" and used the company as an example of why the country needs tax reform.
During a Tuesday interview on MSNBC's "Morning Joe," Sen. Coburn aired his feelings regarding Apple's use of offshore holdings to avoid paying high tax rates in countries like the U.S. and England, reports Business Insider.
The senator said that he was "livid" about the situation, referring to a New York Times piece that claims Apple uses various tax loopholes to save billions of dollars each year.
"Why should Apple pay at 10 percent and some other company that can't export their technology ... why are they paying 35 percent?" Sen. Coburn said.
According to the Times report, the iPad maker pays a tax rate of only 9.8 percent, though some have questioned the calculations quoted in the piece saying that the results are based on incorrect data. Forbes claims that the Times "compared the profits in 2011 not with the taxes paid on profits from 2011. It has compared profits in 2011 with the taxes calculated on the basis of 2010′s profits."
Also critical of the calculations was Fox Business which said "the Times likely used a lower effective rate for Apple versus what the rate really is, which makes the story sound more shocking than it is."
In any case, Sen. Coburn used the opportunity to discuss the current tax code situation in America and alludes to a possible probe into the matter noting that he sent a letter to Sen. Carl Levin (D-Mich.) saying "we've gotta look at this."
While Coburn agrees that there should be incentives for multi-national corporations like Apple to invest worldwide profits in domestic enterprise, he wants to close so-called "loopholes" in the current tax code that allow for tax havens. He mentions Apple's use of its Ireland headquarters and a Caribbean-based offshoot to shelter the company from high tax rates.
Morning Joe co-host Mika Brzezinski asked specifically about a repatriation holiday in which large companies can bring capital back into the U.S. with a lower tax rate in return for certain investment promises like job creation, an event that occurred in 2004 with little effect. In response, Sen. Coburn said that he would support such an initiative as long as stricter controls are placed on money movement.
"You can't just do that, you gotta reform the tax code," Sen. Coburn said. "If [the U.S. doesn't] reform [its] corporate tax code?We're in a global economy, we're not competetive now, we now have the highest corporate tax in the world and only those that have intellectual property that can move the location of that intellectual property offshore can get [tax rates] down."
Sen. Coburn goes on to say that the U.S. needs to rid its tax code of loopholes that allow the "well endowed" to avoid high rates.
"Let's clean it out," Sen. Coburn said. "Let's make it transparent. And let's make it fair."
During a Tuesday interview on MSNBC's "Morning Joe," Sen. Coburn aired his feelings regarding Apple's use of offshore holdings to avoid paying high tax rates in countries like the U.S. and England, reports Business Insider.
The senator said that he was "livid" about the situation, referring to a New York Times piece that claims Apple uses various tax loopholes to save billions of dollars each year.
"Why should Apple pay at 10 percent and some other company that can't export their technology ... why are they paying 35 percent?" Sen. Coburn said.
According to the Times report, the iPad maker pays a tax rate of only 9.8 percent, though some have questioned the calculations quoted in the piece saying that the results are based on incorrect data. Forbes claims that the Times "compared the profits in 2011 not with the taxes paid on profits from 2011. It has compared profits in 2011 with the taxes calculated on the basis of 2010′s profits."
Also critical of the calculations was Fox Business which said "the Times likely used a lower effective rate for Apple versus what the rate really is, which makes the story sound more shocking than it is."
In any case, Sen. Coburn used the opportunity to discuss the current tax code situation in America and alludes to a possible probe into the matter noting that he sent a letter to Sen. Carl Levin (D-Mich.) saying "we've gotta look at this."
While Coburn agrees that there should be incentives for multi-national corporations like Apple to invest worldwide profits in domestic enterprise, he wants to close so-called "loopholes" in the current tax code that allow for tax havens. He mentions Apple's use of its Ireland headquarters and a Caribbean-based offshoot to shelter the company from high tax rates.
Morning Joe co-host Mika Brzezinski asked specifically about a repatriation holiday in which large companies can bring capital back into the U.S. with a lower tax rate in return for certain investment promises like job creation, an event that occurred in 2004 with little effect. In response, Sen. Coburn said that he would support such an initiative as long as stricter controls are placed on money movement.
"You can't just do that, you gotta reform the tax code," Sen. Coburn said. "If [the U.S. doesn't] reform [its] corporate tax code?We're in a global economy, we're not competetive now, we now have the highest corporate tax in the world and only those that have intellectual property that can move the location of that intellectual property offshore can get [tax rates] down."
Sen. Coburn goes on to say that the U.S. needs to rid its tax code of loopholes that allow the "well endowed" to avoid high rates.
"Let's clean it out," Sen. Coburn said. "Let's make it transparent. And let's make it fair."
Comments
Shut up and toe the line before we vote you out. Or, better yet, if you're so enraged about this, where have you been for the past FORTY YEARS?!
Has this moron been living in a cave or what? The top 25 corps in this country pay less than 4% federal taxes per year due to overseas tax shelters and tax code loopholes. He's just now figuring this out? Yeah right.
Another Dork on the hill using poor facts from an article by a new york rag circling the rim as it gets flushed into irrelevance.
In other news Apple is outraged by the taxes paid by US Senators.
"The Debt Bomb?" So has the government secretly been funding Apple's Bank account? is that why Apple is flush with cash and the Government is broke?
I've got an idea - let's penalize a very successful company for doing so by complying with the very laws that you have put into effect and then point fingers at that company and insist that it is their fault.
Funny that Coburn is one of the biggest proponents of massive multibillion dollar subsidies for oil companies, but doesn't approve of Apple legally following the tax laws?
Yeah, he wasn't so livid when it was his buddy Aubrey McClendon at Chesapeake getting filthy rich off the same tax games and oil subsidies.
At least they are talking about a full reform. These tax codes evolved over time. That makes the most sense. Although when you need to factor in the state level, it gets more complicated. Some states don't like the feds telling them how they should tax.
Quote:
Originally Posted by esummers
At least they are talking about a full reform.
I'll believe it when I see it. They can start to regain my confidence by doing full reform of my taxes first, not just companies'.
Quote:
Originally Posted by jragosta
Funny that Coburn is one of the biggest proponents of massive multibillion dollar subsidies for oil companies, but doesn't approve of Apple legally following the tax laws?
Unfortunately your post is really why it's almost impossible to sort out the tax system in a fair and balanced way, since pretty much everyone involved in the political system has their own special interests that they conveniently overlook.
At a high level, he has a point. It's not fair that Apple can massively lower their tax bill (as do Google by diverting a staggering amount of their profits through Ireland), but I don't blame them for doing it. Everyone has a right to manage their financial affairs to the best benefit of themselves. I do it myself with my tax return and investment strategies.
What is needed is an impartial group of people who oversee the laws and tax system to make sure it's fair for everyone, and operates in the best interest of all the people.
Sadly, with the corrupt bunch of morons in government at the moment (on both sides of the aisle), that is a long way from happening.
This from the Senator who said:
COBURN: Continuing the [Bush] tax cuts isn’t a cost, if you added new taxes, new tax cuts, I would agree that’s a cost. It’s not a cost. That’s where we are today. That’s the baseline. It doesn’t score anything to continue them. It costs money if we increase, which I would be willing to do. I think we ought to cut corporate taxes.
Quote:
Originally Posted by Tallest Skil
I'll believe it when I see it. They can start to regain my confidence by doing full reform of my taxes first, not just companies'.
You're absolutely right. As JRagosta mentioned, to Coburn, full reform would mean, "everything except those deductions that relate to oil companies".
Mitt Romney - who is running for President - DOES THE SAME THING AS APPLE. He pays 12% tax despite being a multi-multimillionaire. Talk to him about his Caymen Island and Swiss Bank Accounts. Talk to him about the taxes he avoids paying by not bringing the money back to the USA.
There is nothing wrong with what Apple is doing. Microsoft does it. IBM does it. Mitt Romney does it.
It is not a tax shelter if you keep your money overseas. That isn't income in the U.S.
You guys can start with your presidential nominee.
Bottom line is that Coburn is criticizing a company for complying with US tax regulations, many of which he has had a hand in forming.
I'm sorry, but these clowns in Washington are the very reason tax loopholes exist. I must have missed when the republican, Tom Colburn, complained about Mitt Romney hiding money overseas and using tax loopholes. He'll probably endorse Romney! Funny how it's wrong unless a republican is doing it. What. A. Hypocrite.
I think all of these tax loopholes need to be closed.
News Flash: U.S. Senator "livid" about congress-approved tax laws that reduces tax revenue.