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Apple says $6B U.S. tax payout for 2012 equals '1 out of every 40 dollars' collected from...

post #1 of 157
Thread Starter 
With a year-long congressional inquiry regarding the accounting strategies of several U.S. tech companies coming to an end, Apple on Thursday issued a statement saying it paid $6 billion in taxes for fiscal 2012, representing about 2.5 percent of all collected corporate taxes combined.

Senate Subcommittee Seal


Citing people familiar with the matter, The New York Times reported that the Senate Permanent Subcommittee on Investigations is wrapping up an investigation into a number of technology companies that use specialized accounting practices to avoid U.S. taxes, which are higher than those levied in many foreign countries.

According to the sources, Apple had become the focus of the inquiry as its accountants have managed to allocate some 70 percent of taxable income overseas despite running a base of operations in the U.S. The tactics used are completely legal, though head of the investigations committee Senator Carl Levin said off-shoring income and intellectual property is hurting the U.S. budget and ultimately average Americans.

?This subcommittee has demonstrated in hearings and comprehensive reports how various schemes have helped shift income to offshore tax havens and avoid U.S. taxes,? Senator Levin said at a hearing involving testimony from Microsoft and Hewlett-Packard. ?The resulting loss of revenue is one significant cause of the budget deficit, and adds to the tax burden that ordinary Americans bear.?

Senator Carl Levin
Senator Carl Levin, Chairman of the Senate Permanent Subcommittee on Investigations.
Source: U.S. Homeland Security and Governmental Affairs


As for Apple, Senator Levin said the ongoing investigation revealed the company to have deferred taxes on over $35.4 billion between 2009 and 2011. The amounts Apple does pay, however, are not insubstantial as the U.S. government collected $3.3 billion in cash taxes from the company for the 2011 fiscal year.

In its statement on Thursday, Apple said it was "one of the top corporate income taxpayers in the country, if not the largest," and noted that it "conducted all of its business with the highest of ethical standards, complying with applicable laws and accounting rules.?

For the past fiscal year, Apple said it paid "an enormous amount of taxes" to local, state and federal governments. ?In fiscal 2012 we paid $6 billion in federal corporate income taxes, which is 1 out of every 40 dollars in corporate income taxes collected by the U.S. government,? according to the statement.

Apple is known to be a trendsetter, and apparently this extends into corporate accounting as well. In the 1980s the company created a method that routed income through subsidiaries in Ireland, the Netherlands and the Caribbean called the "?Double Irish With a Dutch Sandwich.? The Times said that hundreds of corporations now use a variation of that tactic, or the exact method Apple uses, to reduce tax burdens.

Cork
Apple's European headquarters in Cork, Ireland.


In the U.S., Apple was accused of sidestepping billions of dollars in taxes by moving profit and investment operations to a headquarters in Nevada to effectively avoid California's 8.84 percent state tax.

Apple is reportedly cooperating with the senate subcommittee's investigation, which is expected to yield recommendations to Congress that may have an effect on future tax code discussions.
post #2 of 157

That seems like a lot of money to take off someone, even a big corporation like Apple.

post #3 of 157
What? They paid $6 billion in taxes, or about 2.5% of all corporate taxes combined? Bit like their market share, isn't it¿

Seriously, I think it's perfectly ok for companies to "managed to allocate some 70 percent of taxable income overseas despite running a base of operations in the U.S" but I'm afraid this thread is going the other direction, if previous reports on this issue are any indication.
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post #4 of 157
This is great for Apple and all but reading things like this makes me think the US tax code needs to be completely overhauled.

So many legal loopholes for big corporations. Just lower rated across the board for everyone. But I guess millions of high end accountants would lose their jobs if that happened...
post #5 of 157

Your remarks are on the same level as the article, which ignorantly states:

 

The resulting loss of revenue is one significant CAUSE of the budget deficit, and adds to the tax burden that ordinary Americans bear.

 

The "tax burden that ordinary Americans bear" has very little to do with taxes paid or not paid by big corporations.  "Corporations not paying enough taxes" is not what got our country into its current financial mess.  Your tax burden has everything to do with how much Democrats spend on Welfare and Republicans spend on Warfare.  

 

Your elected officials KNOW how little or how much money they will get in taxes.  They know!  But despite knowing what they know, they continue to spend more money than they know they will get.  And they have no qualms about it because unlike you and me, they can print new money to pay off debts (albeit, while destroying the value of the US Dollar).

 

The budget could be balanced and debt paid off WITHOUT endless complaints about big corporations dodging taxes or without any tax increases either, simply by taking a knife to spending (both by liberals and by conservatives).  And it's crucial to note that true "cuts" are not defined as "reductions in proposed spending increases," but rather "spending XX% less than we did last year."  Once our debts are paid off, we simply need to stay fiscally minded.  Doing that has nothing to do with Apple.  Simply passing the buck to those whom we define as "rich" does nothing to change the financial mess we are in.  If anything, blaming the so-called "rich" ends up making America into another Greece.  When my family faces hard times, we spend less money to better make it through those hard times.  The government should be no different.  But they are different insofar as they think that "spending more in times of crisis" will magically make the economy better.  Sorry, but that's not how it works in reality.  The reality is that to balance a budget, you need real and meaningful cuts.  And if the people complain about government cuts, it's only a sign that they've grown dependent on government programs.  But as is the case with drugs and alcohol, there comes a time when one needs to end the addiction.  That time is now.  No program should be exempt from cuts, neither Social Security or Defense.

 

Consider well that our elected officials are only doing what "we the people" elect them to do. 

 

Stop pointing the finger at Apple.  Individual Americans must point the finger squarely at themselves.  

post #6 of 157
Very true.. But I HATE these one sided articles that somehow only equate Apples tax burden to that of the only corporation out there "taking" advantage of loopholes. Meaning they are hardly the worst offender considering companies like GE paid ZERO in taxes not to mention the oil companies etc etc etc.

How bout the QUADRILLIONS in
other taxes Apple has generated of late.. Umm let me think...sales taxes for states and local economies, taxes on labor from all it's North American operations -- export fees, etcetera etc etc etc.

The "tax revenue INCREASES" as a result of Apples recent successes is incalculable. Seriously. Stop crying.
post #7 of 157

It's embarrassing that Apple covers so much of the % of total corporate taxes, but it's embarrassing that my former company pays so little, relative to what they really should be paying, if the tax code was honest, ethical and not full of bs loopholes designed to put more and more of the tax burden on consumption only and not on businesses.

 

Pathetic.

 

Personally, I'm sick of the `tax incentives' states give to help large corporations invest in their states. It's not the tax subsidies, but the sheltering against taxes on them that is amoral. No, Silicon Valley isn't moving away from California. It never will. Same with Seattle, New York, Austin, Chicago, Houston, etc.

 

Stop subsidizing massive corporations. They don't need a damn bit of help.

 

It's beyond credible that they alone pay 2.5% of the total taxes when hundreds of thousands of mid to large corporations are copying their ``perfectly legal'' approach to creative shell gaming. One company covering that much of the burden is pathetic. IBM? Microsoft? Oracle? I could go on. What % did each of these pay? None of them nearly enough.

 

End the shell games. Apple will continue to blossom.

post #8 of 157
Quote:
Originally Posted by ascii View Post

That seems like a lot of money to take off someone, even a big corporation like Apple.

 

If you think that's a lot of money, you should check out how much Congress already spent.

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post #9 of 157
Quote:
Originally Posted by mdriftmeyer View Post

It's embarrassing that Apple covers so much of the % of total corporate taxes, but it's embarrassing that my former company pays so little, relative to what they really should be paying, if the tax code was honest, ethical and not full of bs loopholes designed to put more and more of the tax burden on consumption only and not on businesses.

You run into problems with foreign companies, trusts, and the debate over whether basic necessities should be taxed at the same rate, making for a highly skewed method. Companies will always look for ways to minimize tax liability by less than conventional unintended methods, even if the laws are necessary for legitimate functions. You'd have to change the way these liabilities are assessed to make them pay. One way would be to require payments even if the money still resides overseas. On domestic funds, these companies essentially report based on accrual, where they pay somewhat independently of cash flow, yet they write things down/off in the same manner. There isn't any simple method to this. They aren't going to rewrite the entire tax code over a short time period. Even if they did so, what makes you think it's possible to eliminate everything publicly regarded as an unintended consequence in the tax code? The articles on here are really light reading, and should be treated as such. I've never read one that on its own provided enough information for any real conclusions, but they are amusing. I can always look for more information when I'm interested in the topic.

post #10 of 157
Quote:
Originally Posted by Suddenly Newton View Post

 

If you think that's a lot of money, you should check out how much Congress already spent.

Sadly, you're right. They don't seem to have any concept of "too expensive."

post #11 of 157


According to the sources, Apple had become the focus of the inquiry as its accountants have managed to allocate some 70 percent of taxable income overseas despite running a base of operations in the U.S. The tactics used are completely legal, though head of the investigations committee Senator Carl Levin said off-shoring income and intellectual property is hurting the U.S. budget and ultimately average Americans.

 

   why does the justice department not investigate fund managers with their stock manipulations of apple?. they scam investors and the american public out of millions and maybe billions. they should be fined and put in jail

post #12 of 157
Quote:
Originally Posted by hmm View Post

...

One way would be to require payments even if the money still resides overseas.

...

Then US companies would move their respective company or corporate offices out of the country.

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post #13 of 157
Quote:
Originally Posted by JDW View Post

 

The "tax burden that ordinary Americans bear" has very little to do with taxes paid or not paid by big corporations.  "Corporations not paying enough taxes" is not what got our country into its current financial mess.  Your tax burden has everything to do with how much Democrats spend on Welfare and Republicans spend on Warfare.  

 

It is statements like these that confuse people.  Corporations do not pay any taxes when it comes down to it, any taxes a corporation pays it just adds that cost to its product.  All taxes are paid by ordinary americans at some point.  

post #14 of 157
Quote:
Originally Posted by JDW View Post

Your remarks are on the same level as the article, which ignorantly states:

The resulting loss of revenue is one significant CAUSE of the budget deficit, and adds to the tax burden that ordinary Americans bear.


The "tax burden that ordinary Americans bear" has very little to do with taxes paid or not paid by big corporations.  "Corporations not paying enough taxes" is not what got our country into its current financial mess.  Your tax burden has everything to do with how much Democrats spend on Welfare and Republicans spend on Warfare.  


Your elected officials KNOW how little or how much money they will get in taxes.  They know!  But despite knowing what they know, they continue to spend more money than they know they will get.  And they have no qualms about it because unlike you and me, they can print new money to pay off debts (albeit, while destroying the value of the US Dollar).


The budget could be balanced and debt paid off WITHOUT endless complaints about big corporations dodging taxes or without any tax increases either, simply by taking a knife to spending (both by liberals and by conservatives).  And it's crucial to note that true "cuts" are not defined as "reductions in proposed spending increases," but rather "spending XX% less than we did last year."  Once our debts are paid off, we simply need to stay fiscally minded.  Doing that has nothing to do with Apple.  Simply passing the buck to those whom we define as "rich" does nothing to change the financial mess we are in.  If anything, blaming the so-called "rich" ends up making America into another Greece.  When my family faces hard times, we spend less money to better make it through those hard times.  The government should be no different.  But they are different insofar as they think that "spending more in times of crisis" will magically make the economy better.  Sorry, but that's not how it works in reality.  The reality is that to balance a budget, you need real and meaningful cuts.  And if the people complain about government cuts, it's only a sign that they've grown dependent on government programs.  But as is the case with drugs and alcohol, there comes a time when one needs to end the addiction.  That time is now.  No program should be exempt from cuts, neither Social Security or Defense.


Consider well that our elected officials are only doing what "we the people" elect them to do. 


Stop pointing the finger at Apple.  Individual Americans must point the finger squarely at themselves.  

While not disagreeing with you on the whole (this isn't political to me as much as logic) I would say there is a big difference between a family cutting its budget in hard times and a country. Perhaps the father of a family in a dire situation might not simply be able cut his spending he just might have to steal a loaf, if say ... Tiny Tim would die if he didn't? Although I concede countries in dire straights also have starving children. So maybe I just argued with my self there lol

BTW: Unfortunately, in many cases, elected officials are not doing "we the people" elected them to do. They are repaying the lobbyists for financing the seats and cozy existences.
Edited by digitalclips - 1/5/13 at 6:26am
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post #15 of 157

This is very simple.  If congress does not like the existing laws - change them!

No person or corporation has a moral burden to pay more tax than legally required.

post #16 of 157
Simply speaking...their intepretation is that the tax from the sales of Apples blockbuster products are the problem of the deficit... So if apple never existed or if iPhones and iPads didn't sell well then the country and its citizens would not have this problem? This is jokes lol
post #17 of 157
Quote:
Originally Posted by Realistic View Post

Then US companies would move their respective company or corporate offices out of the country.

 

 

let them move. 

 

i bet it will be a net gain for the US economy. and the company will make less on their products when all of a sudden they become imported goods, subject to tarrifs, etc. 

post #18 of 157
Quote:
Originally Posted by sidste View Post

This is very simple.  If congress does not like the existing laws - change them!

No person or corporation has a moral burden to pay more tax than legally required.

 

I have to disagree on general principles. The "moral" and the "legal" are not synonymous. As an example, slavery was once legal in this country, but it was never moral. So, yes, one can have a moral obligation to do (or not do) something without there being a corresponding legal obligation to do the same.

post #19 of 157
Quote:
Originally Posted by sidste View Post

This is very simple.  If congress does not like the existing laws - change them!

No person or corporation has a moral burden to pay more tax than legally required.

 

This subcommittee is doing just that: determining if Congress should change existing laws in the tax code by interviewing representatives in the business world.

 

And you are correct, no person has a moral burden to pay more than is legally required. However you are incorrect when saying it is simple. The more laws you have, the more complicated the system becomes. A well-intentioned law may have unintended consequences. Hence the subcommittee to determine what might be feasible to change.

 

Quote:
Originally Posted by simtub View Post

Simply speaking...their intepretation is that the tax from the sales of Apples blockbuster products are the problem of the deficit... So if apple never existed or if iPhones and iPads didn't sell well then the country and its citizens would not have this problem? This is jokes lol

 

Two points before I respond to this... thought.

 

(1) I hope I missed the sarcasm tag somewhere in your comment.

 

(2) I understand some that use this forum do not use English as their primary language and therefore one cannot assume someone who has slight "mistakes" in grammar and punctuation in their comment is of lesser intellect. Quite the opposite, I, myself, cannot write fluently in another language than English so one with grammatical mistakes in their English comments may be on higher intellectual ground regarding literacy than myself!

 

So please forgive me if I'm assuming too much or misinterpretting what you meant when I say: Please don't take an imaginary premise from the article and create your own illogical conclusion. The article is being very selective on a very broad subject. In no way is this subcommittee blaming businesses for the US deficit. As stated above, it is merely engaging in dialog with US businesses to determine the best course of action in possibly changing tax law. So your comment is at best a misunderstanding and at worst intentionally obtuse to facts and a distraction from the true debate.

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post #20 of 157
Quote:
Originally Posted by Realistic View Post

Then US companies would move their respective company or corporate offices out of the country.

 

There's zero evidence to support that assertion. In fact, it seems entirely unlikely that they would do so, unless you believe that the only benefit of being located in the U.S. are its tax rates.

post #21 of 157
This tax witch hunt is just the gov trying to squeeze as much tax out of a corporation. It is incredible how ignorant that majority of people are when they demonize the corporations. If a company has already paid taxes to a foreign gov, why should they be taxes again by the US gov. Corporations like Apple invest a lot. The more investment, the more they grow...the more they grow, the more people they hire...the more people they higher, the more income tax paid to the government...the more taxes paid to government...the more "revenues" (more revenues, the more the gov can piss the money away or give to those who do not want to work.) Also, the more investment and growth a company has, the better the stock value. A large amount or retirement plans and pension plans are diversified with common stock...so the better the stock value, the better the retirement and pension plans do. People vilify Wall St, but there are a lot of people who count on the retirement and pension plans to do well. The US has the highest corporate tax rate in the world, and we wonder why companies are shipping jobs overseas. cutting or eliminating jobs, doing legal tax accounting "tricks", have overwhelming national debt. Libs think that all corporations are "evil" and that they do not care about the "little guy" and that the "trickle down" effect does not work...there is so much more to it that they do not want to or do not have the ability to think it through. The first part of this post explains why they should not be taxed by gov or taxed at a way lower rate. If there was a Tax holiday (which many companies are fighting for). imagine the huge "bump" in investing those companies would do and the amount of jobs they would create. Unfortunate because of the greedy libs who think all the money made in the US and abroad by citizens is the governments (and the gov to distribute to those tho do not want to work...a communist principle) rather than that money was earned by the people and the businesses, the economy will not get better, the gov will spend more money than it has, and will run many businesses into the ground or force them to more totally overseas. Only when people and companies invest is when it works out for everyone.
post #22 of 157

I find it funny that politicians are the ones criticizing corporations for following the laws that the politicians set up in the first place.  Seriously, they have no one to blame but themselves.

post #23 of 157
Quote:
Originally Posted by Suddenly Newton View Post

 

If you think that's a lot of money, you should check out how much Congress already spent.

 

For FY2013, congress requested $3.8 trillion (3,800,000,000,000). That's ~$434 million per hour. Apple's $6.6 billion would cover the U.S federal spending for ~15 hours.
And don't forget the FY begins 1 October 2012. Congress has not yet passed that requested (or any) budget. The U.S. is running on a 6 month continuing resolution (which is pretty much status quo spending).
post #24 of 157
Quote:
Originally Posted by 98RaptorTA View Post

This tax witch hunt is just the gov trying to squeeze as much tax out of a corporation. It is incredible how ignorant that majority of people are when they demonize the corporations. If a company has already paid taxes to a foreign gov, why should they be taxes again by the US gov. Corporations like Apple invest a lot. The more investment, the more they grow...the more they grow, the more people they hire...the more people they higher, the more income tax paid to the government...the more taxes paid to government...the more "revenues" (more revenues, the more the gov can piss the money away or give to those who do not want to work.) Also, the more investment and growth a company has, the better the stock value. A large amount or retirement plans and pension plans are diversified with common stock...so the better the stock value, the better the retirement and pension plans do. People vilify Wall St, but there are a lot of people who count on the retirement and pension plans to do well. The US has the highest corporate tax rate in the world, and we wonder why companies are shipping jobs overseas. cutting or eliminating jobs, doing legal tax accounting "tricks", have overwhelming national debt. Libs think that all corporations are "evil" and that they do not care about the "little guy" and that the "trickle down" effect does not work...there is so much more to it that they do not want to or do not have the ability to think it through. The first part of this post explains why they should not be taxed by gov or taxed at a way lower rate. If there was a Tax holiday (which many companies are fighting for). imagine the huge "bump" in investing those companies would do and the amount of jobs they would create. Unfortunate because of the greedy libs who think all the money made in the US and abroad by citizens is the governments (and the gov to distribute to those tho do not want to work...a communist principle) rather than that money was earned by the people and the businesses, the economy will not get better, the gov will spend more money than it has, and will run many businesses into the ground or force them to more totally overseas. Only when people and companies invest is when it works out for everyone.

 There are so many fallacies, generalizations, and assumptions in your argument that I will have to leave it at that.

When a company stops chasing profit and start chasing the betterment of their products, services, workforce, and customers, that will be the most valuable company in the world.
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When a company stops chasing profit and start chasing the betterment of their products, services, workforce, and customers, that will be the most valuable company in the world.
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post #25 of 157
Not surprising to see such a slanted, misleading, factually "loose" article coming from someone like Mikey. Gotta love his comparisons:

"As for Apple, Senator Levin said the ongoing investigation revealed the company to have deferred taxes on over $35.4 billion between 2009 and 2011. The amounts Apple does pay, however, are not insubstantial as the U.S. government collected $3.3 billion in cash taxes from the company for the 2011 fiscal year. "

The numbers that jump out are $35.4B deferred and $3.3B paid. However, the former is income (the word is omitted) over 3 years and the latter tax paid in one year. Apples and oranges. That $35B would have resulted in roughly $12B in taxes, an average of $4B/year, or say $3B for '09, $4B for '10, and $5B for '11. It's a large amount of "potential" tax not collected, but it's on foreign sourced income, not U.S. income. It stays overseas, it's perfectly legal, completely in accord with U.S. tax law, and (unlike the picture Mikey tries to paint) utilized by all multinationals. Google and Microsoft are far more aggressive in their uses of international all tax strategies, but I guess as potential "sponsors" of Mikey's drivel (just a WAG) they get to be lost in the crowd. Where's a polygraph when you really need one?
post #26 of 157

Does this mean ALL corporations paid a total of 6x40=$240 billion in taxes?  This seems pretty small compared to the total US federal revenue.   Why do some Republicans continue to propose reducing corporation taxes more? 

post #27 of 157

From Yahoo finance this is taxes Apple paid in the last three years.  $14 billion 2012, $8 billion 2011, $4.5 billion 2010.  The revenues are $55 billion 2012, $33 billion 2011,  $18 billion 2010. 

post #28 of 157
Quote:
Originally Posted by JDW View Post

Your elected officials KNOW how little or how much money they will get in taxes.  They know!  But despite knowing what they know, they continue to spend more money than they know they will get.  And they have no qualms about it because unlike you and me, they can print new money to pay off debts (albeit, while destroying the value of the US Dollar).

 

The budget could be balanced and debt paid off WITHOUT endless complaints about big corporations dodging taxes or without any tax increases either, simply by taking a knife to spending (both by liberals and by conservatives).  And it's crucial to note that true "cuts" are not defined as "reductions in proposed spending increases," but rather "spending XX% less than we did last year."  

 

 

Federal, state, and local governments have to operate on PROJECTIONS for both revenue and spending. They don't really know for sure what spending costs will actually turn out to be, nor do they really know for sure what the tax revenue will end up being at the end of a given year. Why is that? Because expensive government projects can run over budget vs. the original projection (i.e., claiming the Iraq war is going to very short and the cost is going to be shouldered 100% by Iraqi oil revenue), and tax revenue can drop significantly if the economy slows down or goes into a prolonged recession. The combination of those two things can have HUGE repercussions when it comes to debt level, even if the government was technically passing a "balanced" budget each year.

 

Also, the idea that "true cuts" can only be a total reduction of spending vs. the prior year is nonsense. You can grow federal spending at a modest rate and still reduce the debt relative to GDP over time simply by maintaining a growing economy. That's what the U.S. did after World War II and it worked like a charm. National debt dropped like a stone until the Reagan era began.

post #29 of 157
Why do companies only pay 2.5% tax when we pay 8, 10, 13, etc? I wish I only paid 2.5%
post #30 of 157
Quote:
Originally Posted by Timbit View Post

Why do companies only pay 2.5% tax when we pay 8, 10, 13, etc? I wish I only paid 2.5%

Because companies create economy.  You don't.  They use money to do business.  You use money to consume.  

post #31 of 157
Quote:
Originally Posted by tzeshan View Post

Because companies create economy.  You don't.  They use money to do business.  You use money to consume.  

 

Reminds me of what Republicans quoted Obama on "you didn't build that"

post #32 of 157
Quote:
Originally Posted by tzeshan View Post

Because companies create economy.  You don't.  They use money to do business.  You use money to consume.  

 

That's right, people don't matter to the economy, companies do!

 

There are some pretty crazy ideas on the right, but why they talk as though companies are paying taxes on revenue instead of profit, I don't know. If companies are using that money to "create economy", they aren't being taxed on it, so the tax rate is irrelevant.

post #33 of 157
I thought everyone wanted to be patriotic and 'pay their fair share'? Especially liberal companies. Apple, why did you take advantage of loopholes? Why did you not 'pay your fair share'?

I ask this of EVERY liberal taking deductions in 2012!!
post #34 of 157

Incorrect. Because companies can hire accountants to find loopholes and hide money where we can't or it does not pay for us to do so. 

post #35 of 157
Quote:
Originally Posted by Timbit View Post

Why do companies only pay 2.5% tax when we pay 8, 10, 13, etc? I wish I only paid 2.5%

 

That's not what the post says, read it again.
 

post #36 of 157

Last comment: 

 

If we had a really 'fair' tax code (sales tax*) then companies would not looking oversees to hide manage money. 

 

*Sales tax would force everyone to pay. The (demonizing liberal tone) Rich, criminals (drug dealers, launderers, extortionist, etc.) tourist, and yes, even the poor. Because when everyone has some skin in the game, everyone starts to care what happens. Such as what the money gets spent on. 

post #37 of 157
The U.S. is the only industrialized country that taxes it's domestic corporations for profits earned overseas. The tax is the difference between the U.S corporate tax rate of 35% less the tax rate paid to the foreign country. The tax laws are such that the tax is only paid when the actual profits are repatriated (transferred) back into the U.S. This could be as high as 20% of the repatriated profits. This is a disincentive to return the capital into the U.S. corporations with foreign subsidiaries are better off keeping the cash overseas and investing at the lower foreign tax rate. This includes investments in manufacturing and product development. Most corporations make the rational decision to reinvest the overseas profits in non U.S. markets.

The vast majority of economists would tell you the U.S. would be better off with a very low or zero corporate tax rate. This will encourage companies to set up U.S. operations and create jobs. With a zero corporate tax rate the dividend and capital gains tax rate can be much closer to the personal income tax rate. Also, since the U.S. only raises roughly $300 billion a year in corporate taxes, it only takes a modest growth in jobs to offset the lost corporate revenue with increased income and capital gains taxes.

One more thing, loopholes are not an accident. They are deliberately created by congress to encourage behavior. The write off of mortgage interest, state and local taxes, charitable contributions are loopholes.
post #38 of 157
Originally Posted by Richard Getz View Post
*Sales tax would force everyone to pay. The (demonizing liberal tone) Rich, criminals (drug dealers, launderers, extortionist, etc.) tourist, and yes, even the poor. Because when everyone has some skin in the game, everyone starts to care what happens. Such as what the money gets spent on. 

 

Let's look at some hypotheticals:

 

1) No income tax, higher sales tax on absolutely everything sold. 

 

OR

 

2) Flat income tax across the board for all manner of income. Identical percentages regardless of the amount or the way it's obtained.

 

How would these situations change things, and what would be their monetary results?

post #39 of 157
Quote:
Originally Posted by Tallest Skil View Post

 

Let's look at some hypotheticals:

 

1) No income tax, higher sales tax on absolutely everything sold. 

 

OR

 

2) Flat income tax across the board for all manner of income. Identical percentages regardless of the amount or the way it's obtained.

 

How would these situations change things, and what would be their monetary results?

 

A flat income tax would be "fairer" than a ridiculously high sales tax, which is almost the most regressive form of taxation imaginable. Higher sales taxes, which are already 9% or higher in some localities, would also probably depress the economy by discouraging spending. A progressive income tax that treats all sources of income the same would be the fairest tax, with those who benefit most from the social contract contributing proportionally to their benefit.

post #40 of 157
Quote:
Originally Posted by JDW View Post

The "tax burden that ordinary Americans bear" has very little to do with taxes paid or not paid by big corporations.  "Corporations not paying enough taxes" is not what got our country into its current financial mess.  Your tax burden has everything to do with how much Democrats spend on Welfare and Republicans spend on Warfare...

 

...Consider well that our elected officials are only doing what "we the people" elect them to do. 

 

 

Looking in from the outside, it looks like the US has a f*cked up system where one party goes out of their way to sabotage any attempts to fix things, seriously you should look at impeaching some of these politicians who ignore an electoral mandate in the interests of short term gain and ignore what the people "elected them to do", blindly putting their own (or the people paying them) interests first.

 

In Australia I don't mind that the taxes I pay go toward healthcare for myself AND the less fortunate, it's better than wasting it on bailing out fat cat banks who have politicians in their pockets.

 

Taxes paid by the people should be spent on the people.


Edited by hill60 - 1/5/13 at 11:58am
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Better than my Bose, better than my Skullcandy's, listening to Mozart through my LeBron James limited edition PowerBeats by Dre is almost as good as my Sennheisers.
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