Apple lobbies for offshore tax holiday to bring cash to US - Page 3

Originally Posted by boeyc15

oh brother....

Originally Posted by ihxo

at least Apple's not sending all the money to tax haven... like Google.

http://www.businessweek.com/magazine...1043146825.htm

5% is still way more than 2.4% Google's paying.

Originally Posted by freddych

Because those profits were realized overseas and and taxed at local jurisdiction's rates already. To bring them in, they have to pay additional taxes on top of what they already paid to local jurisdictions. If they don't bring them in, they dont have to pay (which is what they are doing now).

Also, I pay well over 40% of my income to taxes, is it fair that I pay 45% while you pay 26%?

Originally Posted by Cinemagic

Sure, why not let Apple and others bring in a trillion dollars tax free. Obama's raising my taxes and local, state and federal agencies are raising fees I pay on everything. We the people can easily afford to pay our own taxes and fees plus Apple's. Let the rich corporations have a holiday. I'll just get a third job so that Steve Jobs can rebuild his Palo Alto home in true style.

Originally Posted by Cpsro

What has the U.S. ever done for Apple?

Originally Posted by Inkling

Obama would give them this tax break in a flash. They voted for him and it's just the sort of Chicago crony politics he's practiced for his entire political life. We can only hope that all those new Republicans we elected last fall show a bit more gumption.

Originally Posted by lamewing

No, it's isn't fair. Everybody (including corporations) should pay the same flat tax. And yes, these corps should pay the same amount when they bring the money back to the States even if they paid local taxes elsewhere. I wish I was saddled with 1/2 to 2/3 of 60 billion dollars. Greedy pricks won't bring the money back to the U.S. out of greed and nothing more.

Originally Posted by libertyforall

Hmm, so ignorance is bliss? You favor corporations over individuals?

Originally Posted by AIaddict

Pretty much only the US tries to double tax like that and hence only US companies need to engage in such strategies to reduce their taxes to internationally competitive levels..

Originally Posted by K.C.

Anyone here ever been to business school ?

Originally Posted by hill60

No they aren't, take a look at the goings on of a lot of the EU based pharmaceutical giants, they're the one's who pretty much invented these schemes.

Originally Posted by freddych

Because those profits were realized overseas and and taxed at local jurisdiction's rates already. To bring them in, they have to pay additional taxes on top of what they already paid to local jurisdictions. If they don't bring them in, they dont have to pay (which is what they are doing now).

Also, I pay well over 40% of my income to taxes, is it fair that I pay 45% while you pay 26%?

Originally Posted by AppleInsider

However, even though the Treasury Department attempted to write rules at the time to ensure the money would be invested locally, most of the cash (60 to 92 percent, according to one study cited in the report) was simply returned to shareholders in the form of stock buybacks and dividends.

Originally Posted by dobber

The presumption for corporate taxes is that corporations really don't pay taxes, individuals do -- because any taxes are passed onto employees with lower wages, or to consumers with higher prices.

It is definitely not something Washington would push on it's own, but with enough word of mouth - we could make this a reality.

Originally Posted by freddych

This is why I like Obama's idea of getting rid of all of the corporate tax loopholes and lowering the corporate tax rate.

And I'm a pretty hardcore conservative (fiscally, on social matters, I'm in the I don't give a crap camp).

Originally Posted by lamewing

Greedy pricks won't bring the money back to the U.S. out of greed and nothing more.

Originally Posted by lamewing

Typical Corporate Greed.. Corporations feel the deserve special treatment. My wife and I pay about 26% of our income to taxes. How is it that these corporations feel they deserve to avoid paying the same in taxes?

Originally Posted by W1ll1am

So Apple needs a 30% cut app developers hard work, but wants to only pay 5% tax for a whole year? I would bet anything that these corporations once again get their way, and that this gets extended for more than a year. I would also like a "Tax Holiday" for next year, and I promise to buy Apple products with the extra cash in my pocket. No seriously I Promise.

Originally Posted by AIaddict

Greedy pricks insist on taxing overseas profits based on greed and nothing more. Even worse, the selfish bastards dont care if it drives jobs overseas, as long as their job is secure.

Originally Posted by Magic_Al

The government could use the money to improve public education and scholarship opportunities so Apple has a better domestic talent pool to hire from.

Originally Posted by dobber

The presumption for corporate taxes is that corporations really don't pay taxes, individuals do -- because any taxes are passed onto employees with lower wages, or to consumers with higher prices.

I think Apple should look at the FairTax (fairtax.org). It replaces our current tax system with a consumption tax (in a progressive way -- it's a tiny bit more complicated than a straight national retail sales tax. It would replace corporate taxes, social security taxes, and income taxes with a simple retail tax -- and it was designed to generate the same amount of revenue for the government. The end result is that you keep all of your paycheck, the IRS goes away, and you pay taxes when you buy retail. It's not a VAT, in that it just charges the final product - so business-to-business transactions are left untaxed.

FairTax did a study on the effect of this, and it would bring a lot of that overseas profit back onshore, which as it's redistributed and spent, would be taxed. It would also tax foreign products at the same rate as domestically produced products, which is not what happens today, so it would level the playing field and help reduce the trade deficit.

It is definitely not something Washington would push on it's own, but with enough word of mouth - we could make this a reality.

Originally Posted by lightknight

Try being less of a poor hobo?
I mean, everyone else, Steve Ballmer, for example, pay WAY less than 25% of their revenue in tax.... only poor people do such ridiculous things.
And it answers your question: corporations ' money is very rich people's money, not "some unknown and faceless entity"'s money. Those people pay very low tax on their income, why should corporations which pay them dividends pay huge taxes, which means less dividends?

Originally Posted by cameronj

Yes, if the government would ONLY spend some more money on public schools! That way our poor, underfunded children (who only get more money per pupil than anyone, for TERRIBLE (and worsening) performance) can finally get a break.

Seriously, do you just read the politicians' speeches and assume that everything they say is true? Sheesh.

Originally Posted by cameronj

Wow, so I guess I'm a very rich person. And so are most people here! Amazing!

It must be nice to have no clue about the world. The people who own public corporations are EVERYONE, just about.

Originally Posted by K.C.

Anyone here ever been to business school ?

The purpose of management is to exploit each employee to the greatest potential and earn a profit for the corporation.

The CFO has the obligation of finding any and every way to avoid paying anyone anything they don't have to.

From hourly wages, to benefits and corporate taxes, it's all the same. Pay as little as the law allows.

When you want to capitalize here and your capital is elsewhere you ask for exceptions to the tax laws.

It's been going on for decades. Apple is one of the many, many corporations to do this.

Their current success makes using their name in the headline good news, hence profit for those that sell news.

It also provides hits for this site and allows greater sales of advertising on the site.

It's the current state of capitalism in this country. No real news here at all.

Originally Posted by AIaddict

The purpose of management is to maximze shareholder value. Value is not exclusively defined as profit, hence many companies are involved in charitable activities because the owners find that valuable, as just one example. Second, many successfull managers believe trying to wring every drop out of the employees and such backfires and that a happy healthy workforce and a possitive relationship with government entities, communities etc. leads to higher long term earnings and therefore better maximizes shareholder value.

And yes I did go to business school.

Originally Posted by aquajets1

Good sentiment. There is a big issue with the theory that throwing money at a problem will make it go away. However, just because that is his belief (erroneous or not) doesn't make him unintelligent.

Originally Posted by AIaddict

If you think simply throwing money at a complex problem will make it go away, and that there are no costs in trying to do so, yes it makes you unintelligent.

Originally Posted by TBell

The trickle down theory doesn't work. Why because nobody forces the rich to share the wealth. If a tax holiday is given, there will be guarantee that stockholders will get a dividend. Apple isn't going to give one.

Originally Posted by sciwiz

Oh the irony....Apple (and others) not wanting to pay 30%.

Originally Posted by aquajets1

While that is the technical purpose, how would you comment on how the effects outside (i.e. personal ambition, government, etc) of the business market affect those decisions?

Just interested.

( by the way, i love how every conversation not related to android turns into a philosophical or societal discussion) (the android ones turn into slap fights)

Originally Posted by cameronj

It's not ironic. NOBODY wants to pay more money than absolutely necessary for anything. That's the amazing thing that makes capitalism works. Whining crybabies want there to be laws that protect them from their employers who, in their minds, are trying to pay too little for their services. Companies on the other hand want protection from having to pay their workers more than they are worth. The tug of war between the two sides ensures that all workers are paid fairly, relative to their peers. A worker with skills more valuable to society as a whole is paid more than one with less valuable skills. That is, until the government steps in.

When that happens, someone with less marketable skills gets paid more than they should, and someone with more marketable skills gets paid less than they should. Because unskilled dummies are a larger part of the workforce (and voting world) than highly skilled ones, societies that lose their will to compete tend to trend towards what the USA and France are today - socialism. In socialism, the more poorly skilled do better than they would have otherwise. The most highly skilled do far, far worse. The net result is that society is worse off, because 100s of thousands of people spend their whole lives merely moving the shells around from person A to person B, instead of doing something to advance society.

It's quite sad, really, and especially when you can watch it happening in slow motion.

Originally Posted by AIaddict

One of the biggest issues in corporate governance is how to allign Management's interests with the shareholders' interest. There is no simple answer. Lets assume a simplest of scenarios where owners only care about money and nothing else....

You can pay an anual bonus based on accounting metrics like profits. The problem is this can encourage a manager close to retirement to shoot for short term profits over long term profits. No investment in R&D, that costs money now, and the profits wont hit for years! It also creates a reward for cooking the books. And so on....

A much better solution is to give the managers stock options, or so we thought for a while. If the shareholders stock price goes up, so does the value of managements options. Wallstreet takes a longer term view and will (often) frown upon management teams that sacrifice long term profits for short term gains, and also the option terms are typically 5 or 10 years so management has to have a longer time horizon to cash in. On the downside, they still find ways to game the system, like backdating their options or managing wall street perceptions, sometimes illegally. There is also the issue that an option does not have the same risks as a share of stock, just the same reward. Management with options will have an incentive to take bigger risks than the shareholders would, knowing that they make a ton if they hit a home run and lose nothing if they strike out. This, along with a bonus structure that rewarded risk played a huge role in the Enron failure. The fraud that made the press was simply an attempt to cover up what had already gone sour from a poor reward scheme. Same issue for the investment banks.

So now what? Boards need to be vigilant and shareholders need to hold boards accountable. As I said even with a simple goal like make money, there is no simple way to keep managers perfectly aligned with shareholder interests. Reward sytems for management need to provide incentives for good behavior and disincentives for bad behavior, but there has to be oversight to make sure the system is not gamed, and action is taken if it is. The companies that do this well have a big long term competitive advantage. Many professional investors (including Buffet) put a big emphasis on corporate governance, more so than historical financial results.