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Wozniak: Criticism of Apple tax strategy 'extremely warranted'

post #1 of 16
Thread Starter 
Apple co-founder Steve Wozniak feels the recent public scrutiny of the iPhone maker's tax strategies is entirely justified, saying that the corporate tax rules in America are "really not fair."

the woz


Wozniak spoke at a conference in Northern Ireland on Thursday, saying that the tax system needs to be reworked to put corporations on the same level as people, according to The Telegraph. Criticism of Apple's tax practices, the Apple co-founder said, is warranted because corporations have more leeway than ordinary people when it comes to taxes.

"Apple itself," Wozniak said, "you'd think, would say, 'My gosh, there's systems. We have to go for it the way we can maximize our profits."

That goal of profit maximization, he said, could lead corporations to do things that might be considered unethical if an individual did so.

"For a corporation," Wozniak opined, "there's no such thing as personal ethics. It's like you will do anything, any scheme you can, to maximize your profits."

The solution, Wozniak said, is to equalize taxation between people and corporations. People are taxed on income, while corporations are taxed on their profits.

"That is why the rich get richer and the poor get poorer," Wozniak said, "and I am always for the individual being much more important than their training; same reason I created Apple computer at the start, it was to empower the little guy."

Legislatures should, according to Wozniak, remake the laws so that both groups are taxed by the same metric.

"Why do businessmen get to write off lunches and cars? If normal people did they would have more savings.

"That is really not fair, that businesses are not treated the same as people.

"A person would say, 'my life is my business and I have to pay for my home, pay for my clothes, my food and what is left over if I make a little money some year and put it in savings, that is my profit', but people are not taxed on profit, they are taxed on income."

Wozniak, who has not worked at Apple in decades, remains a faithful Apple fan and general booster of technology. He is also well known for his frequent, colorful remarks on the affairs of the company he helped create.

His comments, at their core, may be similar to what Apple CEO Tim Cook prescribed when he defended Apple's policies before a Senate panel. Both men call for a simplification of the tax code, but Cook's main point before the Senate was that the code should be simplified downward, in the form of lower corporate taxes.

Apple, Cook said, pays every dollar it owes in taxes. Overseas revenues, though, the company routes through an Ireland-based subsidiary, so as to avoid the United States' 35 percent corporate tax rate.

For domestic earnings, Cook called for the U.S. corporate tax rate to drop to roughly 25 percent. For international earnings, Cook was less specific, though he said that the rate "would have to be a single-digit number."

Wozniak's talk covered a range of other topics, including both education and wearable technology, according to Alan in Belfast. Apple CEO Tim Cook may not have much faith in Glass, but Wozniak was quite interested in the technology.

"I am getting so jealous," Wozniak said. "I don't know if the marketing plan was ripe to hit someone like myself or not... I haven't had time to be a full explorer with that, so I didn't get the Google Glasses yet, but boy that's starting to seem like an interesting thing that I sure want to try."

The Apple co-founder also opined on the viability of an Apple smartwatch, which is thought to be in development.

"I also don't mind the idea of a watch, as long as the watch is my smartphone that I can basically do all my smartphone stuff on including asking Siri questions. Wouldn't mind a watch, but if all it's going to be is pretty much music and measuring how many steps I walk per day, nah, that wouldn't be enough."
post #2 of 16
Yawn. The more I hear about governments and people complaining about large company's not paying tax the more I think why don't politicians get off there arse and change the laws to force tax.

Not that its simple. Americans are probably of the opinion that tax should be paid on profits made overseas while overseas country's are complaining about the low level of tax paid in there country's.
post #3 of 16
Is it possible for Apple to have him banned from saying anything relating to Apple!?
Not that I want to get in trouble with the free-speach movement.

I'm a poor-sole with not much, I do however have a roof over my head
& can feed myself but is not Mr Wozniak a multimillionaire?
Not to stop any rich person from taking up the right of the poor
& downtrodden but this is in no way related to such.
post #4 of 16

Woz, you fool. Why didn't you just come out and say that you've always hated Steve and hated how he marketed your Apple I design and hated how he made a company out of your products and gave you the money to live a life that no human being has ever—and possibly will ever—have again?

 

Originally Posted by AirBubble View Post
Is it possible for Apple to have him banned from saying anything relating to Apple!?

 

They'd probably have to stop paying him first, but yes, Apple can bar him from speaking about the company.

post #5 of 16
actually Woz is wrong. People are taxed on profit only, at least to a degree. Because they get deductions etc.

And if he has an issue with the tax code, fine. But to imply that Apple is doing anything wrong is just being an ass.

As for the tax code, I say if the revenue came from outside of the US then it should be taxed by the area it came from, not the US. It's only fair to the other countries that are providing the same police, roads, utilities etc for the offices and stores in their area.

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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post #6 of 16

I've only read AI's article but isn't he defending Apple by saying corporations are there to maximise profit. If you create a tax system that allows a way around paying tax  then there going to do it and it's nothing to do with ethics as ethics don't apply to a business.

 

But speaking on the side of the common person, corporations making billions should be required to be pay tax in the same way as regular people.

 

Not sure if he actually said it or not, but the other aspect is that if your rich you can shift your income into a business. Just think how much money you would save if the money you paid on your mortgage was tax deductible. If your rich it's not hard to do, if your poor it is hard. To illustrate further if you take £1000 of earning in the UK, you loose 40% leaving you with £600 to pay for your house with, make it tax deductible and you have £1000 to pay for your house with!

 

Hence rich get richer, poor get poorer. Just because he's a millionaire, doesn't mean he can't support poor people.

post #7 of 16
Woz is a better dancer than tax policy analyst.

I.e., in this arena he shows he REALLY doesn't know his butt from his elbow.

And while he seems to love emerging to take the occasional wild swing at the edifice he co-founded, hasn't had anything really germane to offer in his critiques that any outsider who's been out of not only the company's loop but the industry's for decades might randomly offer as a personal opinion...

...still he's entitled to his utterances, blogs and Apple sites that have to perish or publish continue to write them up, and deprived of any other founder to read about, we continue to read and some of us take the time to react to 'em.

So there you go. A perfect (un)virtuous circle.

An iPhone, a Leatherman and thou...  ...life is complete.

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An iPhone, a Leatherman and thou...  ...life is complete.

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post #8 of 16
Quote:
Originally Posted by charlituna View Post

actually Woz is wrong. People are taxed on profit only, at least to a degree. Because they get deductions etc.

Employees have income tax deducted at the full rate before getting paid. From what remains, they have to pay for a car, house, food etc. A company deducts business property and other costs as part of the business and they are taxed on what remains. People who are self-employed can operate like a business but people who are self-employed are in the minority (~10m self-employed in the US vs ~150m employed).

There tends to be comparisons between businesses and self-employed (unincorporated businesses) with suggestions that if someone making <$10k makes unreasonable deductions then that's just as bad as Apple avoiding billions in taxes. People at the low end of the scale typically avoid tax because um... they're poor. Not that unreasonable deductions are ethical at the low-end but far more understandable and have an individually lower impact to the economy. There are probably a few wealthy people who are self-employed and they should have to pay fair tax rates too.

Woz's suggestion of treating employees and businesses the same probably wouldn't work because they can't tax based on revenues or else the company could go bankrupt if the margins aren't high enough. Similarly, individuals being allowed to deduct personal items would allow someone making $1m/year to deduct a $1m house and pay no tax. The important difference with a business is you can't tell how much revenue and profit you will make in a year until you've made it and might have significant outlays initially that are recouped more than a year later. An employee works at a salary and lives within that expected income.

They just need to close down the loopholes on an international level and crack down hard on all companies publicly reporting high profits and low tax rates.
Quote:
Originally Posted by charlituna View Post

As for the tax code, I say if the revenue came from outside of the US then it should be taxed by the area it came from, not the US. It's only fair to the other countries that are providing the same police, roads, utilities etc for the offices and stores in their area.

They haven't been paying anywhere near the expected taxes in those other countries but where it matters for the US is that Apple's Irish subsidiaries and cash are managed in the US so if, as you say, they should be taxed based on where the management and cash are, that would be the US. Right now, it's nowhere as they've managed to setup subsidiaries with no tax jurisdiction.
Quote:
Originally Posted by timgriff84 
ethics don't apply to a business

Apparently but that's not a justification any more than it is for say pollution:

http://gizmodo.com/5903021/bp-oil-spill-aftermath-eyeless-shrimp-clawless-crabs-and-fish-with-oozing-sores

You couldn't justify their actions by saying they were just maximizing shareholder profits. Behind every active company, there are people who are expected to run their businesses ethically. Part of those ethics should be that we expect to live in a sustainable, safe and civilized society. That requires paying for justice, social security etc. Many of the people who would criticize government services would be the millionaires and billionaires who benefitted from the multi-trillion dollar bailouts that protected their investments. Their gratitude includes not paying taxes:

http://en.avaaz.org/1202/who-are-the-worlds-biggest-tax-avoiders

There's abuse at the low-end too of course:

http://www.dailymail.co.uk/news/article-2303120/Mick-Philpott-vile-product-Welfare-UK-Derby-man-bred-17-babies-milk-benefits-GUILTY-killing-six.html

I doubt many would suggest that these low-lifes were just maximizing their personal gain by following what the law allowed them to do and applaud them for doing so but it's the same reasoning - whatever the law allows you to get away with is supposedly ok. The law is wrong in that it does allow this to happen but everyone lives by their own personal code of ethics. The law is just there to stop you when you step well outside of a boundary that encompasses a wide range of ethics. That shouldn't mean everyone gravitates towards the boundary but that happens when it's more rewarding to do so.

People at the bottom like to blame the people at the top, people at the top blame the people at the bottom and the worst stereotypes are used in both cases. In every case, the problem is that the people behind the faults have a poor sense of ethics and work towards the boundary of the law. You can have 17 kids and live on welfare and you can run a business and pay little to no tax. Ideally you would have a reasonably sized family, work and pay appropriate levels of tax.

Maximizing personal gain as a measure of success starts as an observation - for example, you can observe that the CEO of Goldman Sachs lives a comfortable lifestyle from abusing the economy to the detriment of millions of people:

http://www.dailymail.co.uk/news/article-2244185/Inside-Goldman-Sachs-CEO-Lloyd-Blankfeins-32-5-million-Hamptons-estate.html

as do his employees:

http://www.businessinsider.com/bryce-markus-2010-8

When it moves from an observation into a philosophy, it becomes damaging. Why would people who live a comfortable lifestyle care about anyone who suffers from their success? Why would they feel obligated to pay taxes to support them?

The decision makers at Apple appear to be ethical individuals, as do the people at Google, Microsoft, Yahoo and so on. At the end of the day though, these are people who are pretty much all multi-millionaires who don't pay mortgages, don't have to worry about losing their homes if they stop working, don't have to do meaningless jobs for a living and don't have to worry about medical care. That disconnects them from hundreds of millions of workers who do face these issues. Some can scoff and suggest poorer people work harder but workers in China put in more hours than Tim Cook so it's not for a lack of trying. People at the top have to understand that they have benefitted from a system that allows them to be there and that system has to be supported. That means not just paying US taxes but taxes where they make 60% of their profits too.

People say that they pay $6b+ in taxes but that's just what Apple claims and they are reporting different figures publicly from what they pay to the IRS. In 2009, Apple claimed a tax provision of $3b but paid $1.6b; 2010 $3.8b, actual was $1.2b; 2011 $6.9b, actual paid was $2.5b:

http://blogs.reuters.com/felix-salmon/2013/05/21/why-public-companies-should-have-public-tax-returns/

We don't really know if they are the top tax payers in the US, that's what they claim. It could be Exxon:

http://www.forbes.com/sites/nickschulz/2012/08/09/taxation-hero-exxonmobil-pays-3-in-taxes-for-every-1-in-profit/

Either way, it's less than what's expected. If the rate is 35% then that's the rate. It's not 35% or whatever figure is deemed high enough, whichever is reached first. If their rate is 20%, that's not terrible but it's less than the rate expected of them. Internationally, less than 5% is well below what they are expected to pay. However, if any company decides not to follow the worst offender, they are at a disadvantage.

As for Woz, he's been on the offensive about Apple over a number of issues. Maybe he's always felt like this towards them but it's odd to hear him do it so often given his link to the company. It seems like there's more to it than he lets on.
post #9 of 16

Woz is such a fucking troll. He publically comes out against Apple, 100% of the time, on every single issue. It's incredible. Whether it's shilling for the latest Samsung device, proclaiming that Microsoft is now the innovative one and Apple has lost it's touch, or otherwise bitching about anything Apple ever does, he's consistent in trashing Apple whenever he can. Not once has he defended Apple against any accusation, no matter how absurd the accusation is. It's pretty disgusting, and one would think he could manage to keep his mouth shut if only out of respect for his former friends Steve Jobs, and knowing how much (misguided) weight people place on his opinions, which are used joyfull for all those who want Apple to fail. I'd have no problem if Woz opinions had some substance and made sense, but they're always superficial, blindly adhere to the latest anti-Apple meme, or just utterly obtuse and downright ignorant, like this latest one.  

 

I've also noticed that since Steve's death, he subtlety rewrites history everytime he opens his mouth to give himself more credit, and Steve less. Like when he bashed the movie "jOBS" because he claimed it gave SJ credit for things that he himself did, or his line from this very article:

 

" same reason I created Apple computer at the start, it was to empower the little guy."

 

Not "we". Not "Steve and I". No, just "I". 

 

If it wasn't for SJ, Woz would be nothing. He wouldn't be internationally known, nor would he be rolling in cash, set for life. Woz has absolutely nothing to do with Apple since it's very earliest days, and certainly nothing to do with their success in the past 20 years, yet he's treated as if he's responsible for it. Steve made Apple what it is, and Woz what he is. SJ would most likely have found some other nerd to do the same thing Woz did, but there's no chance Woz would have found another SJ to bring him such greatness. Woz was happy to continue giving his stuff away or to impress people at the computer club. Actually, Apple's success came from SJ going AGAINST Woz's philophies and desires. Woz would have much rather he sells DYI kits than prepackaged machines, and Apple' core values and it's product goes against everything Woz believes in. He never understood the company that Steve built, and he never will. But he has no problem attaching himself to it when its convenient and when it brings him fame, and no problem bashing the hell out of it when it suits him. 


Edited by Slurpy - 6/2/13 at 5:15pm
post #10 of 16
Originally Posted by Slurpy View Post
Woz is such a fucking troll. He publically comes out against Apple, 100% of the time, on every single issue. It's incredible.


Worst part is, Apple still pays him. I could almost excuse it if he wasn't getting a paycheck every [time period]… 1oyvey.gif

post #11 of 16

They can bar him from publicly speaking about them if he is on the payroll. If he is no longer employed by him there isn't anything that they can do to stop him from talking about him. As long as he isn't slanderous or starts lying they can't do anything if they aren't paying him.
 

post #12 of 16
I partially agree with him though Apple is not the only guilty one here. Unfortunately, because it is so popular, it has the biggest target on its back so Congress (which remember is the opposite of progress no matter who is in charge) focuses in on them and asks Tim Cook to testify so it makes them look as though they are doing something before they go on another recess.
post #13 of 16
Originally Posted by Chrisjm00 View Post
They can bar him from publicly speaking about them if he is on the payroll. If he is no longer employed by him there isn't anything that they can do to stop him from talking about him. As long as he isn't slanderous or starts lying they can't do anything if they aren't paying him.

 

But if they are paying him, he can lie and slander all he wants? Doing that now.

post #14 of 16
Quote:
Originally Posted by Chrisjm00 View Post

They can bar him from publicly speaking about them if he is on the payroll.

 

 

They can try, but if he carries on anyway then all they can do is stop paying him.   If they're choosing to carry on paying him then that's Apple's problem.

 

Interesting parallel with Apple and taxes tbh.  Woz/Apple is doing nothing wrong, it's Apple/the-tax-code that's at fault.

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post #15 of 16
Quote:
Originally Posted by Slurpy View Post

Not once has he defended Apple against any accusation, no matter how absurd the accusation is. It's pretty disgusting  

 

I'm pretty sure that's not true, and in all likelihood he says things that are pro-Apple even more often than are reported on.  Why would anyone report on Woz saying how great Apple are?  It's not news, not even click-bait. 

 


Quote:
Originally Posted by Slurpy View Post

one would think he could manage to keep his mouth shut if only out of respect for his former friends Steve Jobs

 

That's a pretty absurd reason for Woz to not say what he thinks.  Jobs is dead, Jobs is not Apple, and Jobs is not immune from criticism.  And he's not even criticising Apple in this story, he's criticising the tax code.

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post #16 of 16
I just checked my iPhone's clock and his 15 minutes long ago expired.
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