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Apple accused of sidestepping taxes, company counters by touting job creation

post #1 of 222
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After being questioned about its tax practices, Apple has issued a public comment to defend itself, noting that it has more than 47,000 total full-time employees in the U.S. in all 50 states.

Apple issued the statement to The New York Times, which published it in full this weekend. It came in response to a report that claimed Apple sidesteps billions of dollars in taxes.

The report revealed that Apple has an office in Reno, Nev., just 200 miles away from its Cupertino, Calif., headquarters, to collect and invest its profits. By doing this, the company avoids paying California's 8.84 percent state income tax on gains.

"Setting up an office in Reno is just one of many legal methods Apple uses to reduce its worldwide tax bill by billions of dollars each year," the report by Charles Duhigg and David Kocieniewski said. "As it has in Nevada, Apple has created subsidiaries in low-taxes places like Ireland, the Netherlands, Luxembourg, and the British Virgin Islands ? some little more than a letterbox or an anonymous office ? that help cut the taxes it pays around the world."

The report from the Times comes on the heels of a separate story published earlier this month by the Daily Mail, which highlighted Apple's use of a headquarters in Cork, Ireland, which allows it to pay about half the tax rate than it would in the U.K. That report also noted that Apple has an offshoot based out of the Caribbean, where tax rates are favorable in the British Virgin Islands.

For its part, Apple said it has created an "incredible number of jobs" in the U.S. over the last several years. It noted that the vast majority of the company's global workforce remains in the U.S., where it has more than 47,000 employees.

"By focusing on innovation, we've created entirely new products and industries, and more than 500,000 jobs for U.S. workers ? from the people who create components for our products to the people who deliver them to our customers," Apple's statement reads. "Apple's international growth is creating jobs domestically since we oversee most of our operations from California."

App Economy growth
Source: TechNet


The company also went on to discuss its taxes, revealing that it pays an "enormous amount" to various governments. In the first half of its fiscal year 2012, Apple says it generated almost $5 billion in federal and state income taxes, including income taxes withheld on employee stock gains.

"We have contributed to many charitable causes but have never sought publicity for doing so," the company added. "Our focus has been on doing the right thing, not getting credit for it. In 2011, we dramatically expanded the number of deserving organizations we support by initiating a matching gift program for our employees."

It concluded its statement with: "Apple has conducted all of its business with the highest of ethical standards, complying with applicable laws and accounting rules. We are incredibly proud of all of Apple?s contributions."

Back in February, an independent report from TechNet issued a report on the number of jobs the iPhone and its App Store have brought to the U.S. since 2008. The report found that the "App Economy" resulted in the creation of nearly 500,000 U.S. jobs in just four years.
post #2 of 222

Why Apple finds it necessary to defend themselves publicly against these socialist mouthpieces (Mike Daisey, NY Times) is beyond me. They should just call them up individually late at night, like Steve used to do, and berate them until they cry "Uncle"!


Edited by SpamSandwich - 4/29/12 at 2:58pm

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post #3 of 222

Once again Apple being singled out for something all companies do, legally by the way. Lather, rinse, repeat. And so it goes.

post #4 of 222

If only employees could have as many successful avenues for avoiding taxes as the corporations that pay them.

melior diabolus quem scies
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post #5 of 222

Let’s hope this is the tip of the iceberg for constant media stories revealing how corporations and the very wealthiest dodge taxes, resulting (inevitably) in a greater share of the load being borne by the rest of us.

post #6 of 222

 

Quote:
Originally Posted by Gatorguy View Post

If only employees could have as many successful avenues for avoiding taxes as the corporations that pay them.

 

Don't count on that ever happening. Plus, even if employees were given the tax advantages, it is beyond most people to figure out how to "git 'er dun."

"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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post #7 of 222

Ok.  so Apple does a lot of good things.

 

But it could do one more good thing:  It could pay its fair share of taxes!

post #8 of 222

"Apple accused of sidestepping taxes"

 

The legal abstraction we call a "corporation" was created, in large part, to enable the wealthy to avoid paying taxes.  To focus on any individual corporation is to completely miss the point.

 

Like so much writing on corporate behavior, the insistence on ignoring context means the result resembles surrealist poetry more than journalism.  

 

post #9 of 222

 

Quote:
Originally Posted by nagromme View Post

Let’s hope this is the tip of the iceberg for constant media stories revealing how corporations and the very wealthiest dodge taxes, resulting (inevitably) in a greater share of the load being borne by the rest of us.

 

It's no "dodge" to pay one's rightful share of taxes. It's just being smart. You must just turn in a 1040-EZ and call it good. Not moi.

"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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post #10 of 222

 

Quote:
Originally Posted by Gatorguy View Post

If only employees could have as many successful avenues for avoiding taxes as the corporations that pay them.

 

An individual could incorporate and there are a number of strategies for minimizing taxes legally. For one thing, have your employer hire you as a consultant and take advantage in that way. In my opinion, a person who does not take advantage of what is available to them to save money is a fool. As they say, "It's not what you make, it's how much you keep".

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post #11 of 222

 

Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

Ok.  so Apple does a lot of good things.

 

But it could do one more good thing:  It could pay its fair share of taxes!

 

ZZZ, you sure talk a lot of shit about Apple. Do you ever get tired?

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post #12 of 222

 

Quote:
Originally Posted by rbryanh View Post

"Apple accused of sidestepping taxes"

 

The legal abstraction we call a "corporation" was created, in large part, to enable the wealthy to avoid paying taxes.  To focus on any individual corporation is to completely miss the point.

 

Like so much writing on corporate behavior, the insistence on ignoring context means the result resembles surrealist poetry more than journalism.  

 

 

That's too simplistic a view of why corporations were first created (link):  

 

 

Quote:

 

Historically, corporations were created by a charter granted by government. Today, corporations are usually registered with the state, province, or national government and regulated by the laws enacted by that government. Registration is the main prerequisite to the corporation's assumption of limited liability. The law sometimes requires the corporation to designate its principal address, as well as a registered agent (a person or company designated to receive legal service of process). It may also be required to designate an agent or other legal representative of the corporation.

Generally, a corporation files articles of incorporation with the government, laying out the general nature of the corporation, the amount of stock it is authorized to issue, and the names and addresses of directors. Once the articles are approved, the corporation's directors meet to create bylaws that govern the internal functions of the corporation, such as meeting procedures and officer positions.

The law of the jurisdiction in which a corporation operates will regulate most of its internal activities, as well as its finances. If a corporation operates outside its home state, it is often required to register with other governments as a foreign corporation, and is almost always subject to laws of its host state pertaining to employmentcrimescontractscivil actions, and the like.

 

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post #13 of 222

 

Quote:
Originally Posted by rbryanh View Post

"Apple accused of sidestepping taxes"

 

The legal abstraction we call a "corporation" was created, in large part, to enable the wealthy to avoid paying taxes. 

 

 

I don't agree with you. The main advantage to a corporation is/was to shield owners of liability created by the corporation by separating the assets of the owners from the assets of the corporation. 

 

As a owner of a corporation I pay personal taxes as well as corporation taxes. 

 

During a good year most corporations feel they have done well if they have earned 5% after taxes. Apple is unique in their profitability before taxes is extremely high. All the more reason to be as astute in taking every legal deduction and structuring their business to their best advantage. If the government is butthurt because of that, the government has the right and ability to change the tax laws they created. 

"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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"That (the) world is moving so quickly that iOS is already amongst the older mobile operating systems in active development today." — The Verge
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post #14 of 222

The hell w/ their job creation.  They weren't creating jobs with billions of dollars in tax revenue.  Like other large multinational corporations, they know damn well they're avoiding paying taxes with their activities. 

post #15 of 222
Quote:
Originally Posted by rustyshacklefor View Post

The hell w/ their job creation.  They weren't creating jobs with billions of dollars in tax revenue.  Like other large multinational corporations, they know damn well they're avoiding paying taxes with their activities. 

 

And as it's all legal, there's not much that can be said about it. More money brought in is good for stockholders, employees, and R&D. They're avoiding paying unnecessary taxes.

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post #16 of 222
Gee, maybe California should consider lowering its ridiculous tax rate instead of complaining about Nevada.
post #17 of 222

http://www.geekculture.com/joyoftech/joyarchives/1684.html

 

Next up - how the New York Times avoids billions in taxes...

post #18 of 222

As a stock holder I would more than a little annoyed if the Apple leadership did not take every available to maximize profits.  It goes without saying there is an expectation they will do nothing illegal or anything that will seriously damage the brand name.

post #19 of 222

Start your own company.  I pay $100 in federal taxes for $100,000 in income.  It is legal and the law needs to be reformed.  It won't be as long as people are ignorant about how much they are getting ripped off. The reason we have a deficit is that we have made an overly complex and dishonest system.  Make Congress reform it and bury any member of Congress that says that tax reform needs to avoid raising taxes.  The taxes that should be raised are those who avoid paying taxes.  It is really simple.  Set a floor like the alternative minimum tax for corporations and investment income over 50,000.  

 

On the other hand, if Apple did not take every loop hole they can find then shame on them.  The guilty party is the Lawmakers that made this possible, and not the corporation that is looking after its shareholders.

post #20 of 222

"Next up - how the New York Times avoids billions in taxes..."

 

They do it the easy way. They just avoid making a profit. lol.gif

post #21 of 222

 

Quote:
Originally Posted by MyDogHasFleas View Post

Gee, maybe California should consider lowering its ridiculous tax rate instead of complaining about Nevada.

 

You need to consider something here. Apple is a big company, so even a small percentage is a lot of money. It wouldn't matter what percentage California charges. Apple would avoid it if possible simply because you're talking about a lot of money. All your statement indicates is that you typed the first thing that came to mind. Apple is trying to avoid taxes, so taxes must be too high, right? California does have some issues, but your solution wouldn't change anything. 

post #22 of 222

The trashy New York Slimes continues it's ridiculous jihad against Apple. Did Apple disinvite them from some event again? The New York Slimes is already guilty of running the bogus and untrue Chinese "slave labor" fables about Foxconn and Apple and here they go again, running a garbage story about Apple not paying their fair share of taxes.

 

Who decides what constitutes fair? Some liberal wankers at the New York Slimes? I think not. Paying as little in taxes as possible is common practice amongst virtually all large corporations. Apple is being singled out simply because they are very successful. Nobody was whining about Apple not paying their fair share of taxes and I don't recall too many people making up lies about Chinese slave labor some years ago when Apple wasn't as profitable as it is today.

 

The people criticizing Apple are anti-American, as they despise and loath successful individuals and companies. Apple is in full compliance with all tax laws and as long as they are, nobody has a right to dictate what tax rate Apple should pay. I also bet that the hypocritical losers that criticize Apple pay as little in taxes as they can and I also bet that they donate practically nothing to charity. If somebody has a problem with the tax laws, then get them changed, and quit whining. Nobody can blame somebody else for simply following the law.

 

If the New York Slimes wanted to write a decent story about people not paying their taxes, then why not write a story about all of the people who work for the current administration and for the Fed?, some of whom owes many years in unpaid back taxes. These people are tax cheats, defrauding the US government and the American people (you and me) for vast sums of money and while Apple is fully up to date with their taxes and in full compliance with the law, not paying your taxes at all, like the scumbags previously mentioned is illegal, and these people should be put behind bars.

 

I wouldn't even wipe my ass with the New York Slimes, as I'd probably catch some nasty liberal disease from it.

 


Edited by Apple ][ - 4/29/12 at 4:09pm
post #23 of 222

And instead of working on tax reform, President Obama wants to collect a few billion more from a wealthy few.

post #24 of 222

 

Quote:
Originally Posted by nagromme View Post

Let’s hope this is the tip of the iceberg for constant media stories revealing how corporations and the very wealthiest dodge taxes, resulting (inevitably) in a greater share of the load being borne by the rest of us.

 

 

I assume that you own Apple products since you post here. What do you think will happen if the government raises taxes on corporations? They will raise prices. That's all corporate taxation does - makes goods more expensive for consumers. 

 

Apple pays way too much in tax. Apple is a great company that has gotten where they are by hard work and innovation. The media should focus on how our government and Fed collude with the military-industrial complex, medical-industrial complex, and Wall St. to waste all of our tax dollars.

 

Apple is being used as a scape-goat for the massive debt-bomb that is blowing up the country. THEY ARE PAYING BILLIONS INTO THE SYSTEM, let's focus on those who suck trillions out of the system. Bailouts?

post #25 of 222

Even if CA reduced tax rate to 4%, that is still 4% more than Nevada.  There is still no incentive for Apple to pay CA taxes.


 

post #26 of 222

"Designed by Apple in California"

 

That mantra doesn't look so cool now.

 

post #27 of 222
I'm still waiting for the New York Times to do an analysis on GE's taxes, or the billions in back taxes that Berkshire Hathway, aka Warren Buffett are refusing to pay. Of course that's not good click bait like Apple is.
post #28 of 222

I love the word choice here: "sidestepping"...one poster uses the word "dodge".

 

While both technically correct these terms clearly have a pejorative tone.

 

Apple is not doing anything wrong. They are doing everything they can (and undoubtedly have a legal responsibility to do for their shareholders) to legally pay the least amount of taxes possible in order to retain as much of the money they've earned for their shareholders and/or to invest in future production and growth.

 

Good for them. Keep it up Apple! You have no reason to apologize.

The state is nothing more than a criminal gang writ large.

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post #29 of 222

 

Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

But it could do one more good thing:  It could pay its fair share of taxes!

 

And who says that paying more taxes than they are legally obligated to pay is a "good" thing?

 

Also, perhaps you can objectively define for us the "fair share" they should pay.

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post #30 of 222
Quote:
Originally Posted by Cpsro View Post

"Designed by Apple in California"

 

That mantra doesn't look so cool now.

 

Huh? Every Apple employee that works in California (which includes the most highly compensated executives) pay taxes in California. I'm sure Apple pays a sizeable amount of property tax as well.
post #31 of 222

 

Quote:
Originally Posted by senyorapple View Post

As a stock holder I would more than a little annoyed if the Apple leadership did not take every available to maximize profits.  It goes without saying there is an expectation they will do nothing illegal or anything that will seriously damage the brand name.

 

A lot of larger companies do things that could get them fined or prosecuted if the IRS actually had the resources to unravel them. The IRS generally doesn't like corporate targets. Corporate audits cost a lot of money and take a lot of time, so they would have to be sure they could extract a lot of money before proceeding. Apple's biggest problem would be if they were hit with an accumulated earnings tax, but again that's unlikely as I doubt the IRS even has the resources to audit such a thing. 

 

Quote:
Originally Posted by Apple ][ View Post

The trashy New York Slimes continues it's ridiculous jihad against Apple. Did Apple disinvite them from some event again? The New York Slimes is already guilty of running the bogus and untrue Chinese "slave labor" fables about Foxconn and Apple and here they go again, running a garbage story about Apple not paying their fair share of taxes.

 

Who decides what constitutes fair? Some liberal wankers at the New York Slimes? I think not. Paying as little in taxes as possible is common practice amongst virtually all large corporations. Apple is being singled out simply because they are very successful. Nobody was whining about Apple not paying their fair share of taxes and I don't recall too many people making up lies about Chinese slave labor some years ago when Apple wasn't as profitable as it is today.

 

 

 

My only issue with your post is that your opinion would flip if a similar story involved Samsung or Google.

post #32 of 222

 

Quote:
Originally Posted by senyorapple View Post

As a stock holder I would more than a little annoyed if the Apple leadership did not take every available to maximize profits.

 

In fact they may have a legal obligation to do this for exactly the reason you point out.

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post #33 of 222

blah

post #34 of 222

 

Quote:
Originally Posted by whatyouneed View Post

That's all corporate taxation does - makes goods more expensive for consumers.

 

+1 for someone who actually gets it!

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post #35 of 222

 

Quote:
Originally Posted by Rogifan View Post


Huh? Every Apple employee that works in California (which includes the most highly compensated executives) pay taxes in California. I'm sure Apple pays a sizeable amount of property tax as well.

 

"applogist" viewpoint

post #36 of 222

 

Quote:
Originally Posted by Cpsro View Post

"Designed by Apple in California"

 

That mantra doesn't look so cool now.

 

Looks fine to me. Only I personally wish it wasn't California but some other state that doesn't hate business so much.

 

The state is nothing more than a criminal gang writ large.

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post #37 of 222

 

Quote:
Originally Posted by whatyouneed View Post

That's all corporate taxation does - makes goods more expensive for consumers. 

 

And help pay for public education to produce future employees, roads, utilities, make up for tax incentives that were given, etc.

post #38 of 222

 

Quote:
Originally Posted by Gatorguy View Post

If only employees could have as many successful avenues for avoiding taxes as the corporations that pay them.

 

They do.  They take jobs in other states.

post #39 of 222

Good for Apple -- no corporation pays any taxes, it is always a cost passed on to consumers in the cost of products!

 

No person or company should pay more taxes than they can find out how to minimize their tax burden!  Kudos for finding ways to lower strangling taxation.  Government is too big at all levels anyways, what we need is LESS government, and the only way to do that is through LOWER TAXES!!!!!

post #40 of 222

 

Quote:
Originally Posted by Cpsro View Post

And help pay for public education to produce future employees, roads, utilities, make up for tax incentives that were given, etc.

 

No.

 

First, we're primarily talking about income taxes here.

 

Second, as a couple of astute posters have already pointed, corporate taxes are simply passed on the their customer. Period.

 

Third, many utilities are paid for directly by utility customers of which corporations are one.

 

Fourth, roads are typically paid for directly by gas taxes, making them essentially a usage fee which companies pay directly or indirectly anyway.

 

Fifth, government education is paid for by property taxes which companies pay directly or indirectly anyway

 

Finally, and most importantly, you assume that none of these things would be ever be possible or provided if it weren't for government and taxes. That's a fallacy.

 

The state is nothing more than a criminal gang writ large.

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