Apple's bond offering will allow it to avoid $9.2B in US taxes

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Comments

  • Reply 41 of 105
    cnocbuicnocbui Posts: 3,613member

    Quote:

    Originally Posted by Tallest Skil View Post


     


    I want to see you paying 99% of your income in taxes, otherwise you're a hypocrite.





    I wonder, is the actual tax rate closer to 30% than your 300% exaggeration ..hmmmm?


     


    The US government should just change the law so that the tax is payable now - repatriated or not - and make it retrospective for the last 10 years - job done.  National debt reduced slightly.

  • Reply 42 of 105
    anantksundaramanantksundaram Posts: 20,407member

    Quote:

    Originally Posted by red_kola View Post


    Tax avoidance reported as "a good thing". No wonder your deficits will never be reduced...



    Do you not avoid paying taxes you don't have to pay?

  • Reply 43 of 105
    jungmarkjungmark Posts: 6,926member
    zoetmb wrote: »
    It's not the same at all. When you speed, you break the law. The fine is because of that.

    Apple's strategy is not breaking current law, but it is breaking the spirit of the purpose of the tax code and the economy.

    Almost no Fortune 500 companies pay Federal taxes most years. This is why the country is broke. Our Congress, especially Republicans, are like Leona Helmsly. She said, "pay taxes? Only the little people pay taxes," but she went to jail for it (for not paying taxes, not for the statement).

    Apple paid 6 billion. In any case both parties work for corporations and not us.
  • Reply 44 of 105
    ajbdtc826ajbdtc826 Posts: 190member
    Avoiding to pay tax is not a good thing. But I guess you can't blame them while our government is so incompetent with spending as it is. That could've been $9.2B to help support programs that we *need*, but it'd probably just get lost in the weeds anyway.
  • Reply 45 of 105
    anantksundaramanantksundaram Posts: 20,407member

    Quote:

    Originally Posted by nollam View Post



    There seems to be a lot of misunderstanding (or just misrepresentation) on this topic. Apple *has* paid tax on its overseas earnings, it pays tax in each of the jurisdictions in which it operates. What AAPL is wisely trying to avoid, is a double-taxation situation where it will have to pay *again* on revenues it returns to the US.


    This is all there is to it. It is a pure artifact of the fact that most of the rest of (civilized) world uses something called the "territorial" system of taxation, whereby you are assumed to have met your tax obligations in the home country if you're paid it in the host country. For example, if a German company doing business in Singapore paid their (very low) taxes, German tax authorities treat is as taxes having been paid. The company is free to move its money about as it wishes, including back to Germany, with no additional tax penalties.


     


    The other system -- which the US, unfortunately, uses -- is called the "worldwide" taxation system. Your host country income is taxed at the home country rate when the money is brought back home. (On the flip side, you do get a tax credit if the host country has a higher corporate tax rate; sadly, the US has among the highest rate for any industrialized country -- most of the world taxes corporations at 20%, but the US rate is 34%).


     


    So what do you think rational US companies do with the profits they earn abroad? They don't bring it home. Every US multinational does it, not just Apple.


     


    If the US has a fiscal mess, it's totally because of its f'ed up fiscal policies. The problem could be got rid of in one stroke if Obama and the Congress could move to the territorial taxation system that most of the industrialized world uses.

  • Reply 46 of 105
    jk7117jk7117 Posts: 19member

    Quote:

    Originally Posted by jd_in_sb View Post





    The USA is in debt because the government spends money like a drunken sailor,




    Exactly right. And what does our current President do after getting his increased taxes in January 2013, he submits a budget with more increased spending and higher taxes. My question is that no one answers is how much spending is enough for this government? And let's not forget the monstrosity un-affordable care act, that was suppose to save us all money, we'd get keep our current doctor and more people will be insured, oh guess what none of that is happening, it's just the opposite. So now the people who pushed that complete POS are saying they need more money to fund it, surprise, surprise.

  • Reply 47 of 105
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by anantksundaram View Post


    This is all there is to it.


     


    [...]


     


    If the US has a fiscal mess, it's totally because of its f'ed up fiscal policies. The problem could be got rid of in one stroke if Obama and the Congress could move to the territorial taxation system that most of the industrialized world uses.



    In case you haven't noticed the entire world has a fiscal mess on their hands. This single policy change would do very little to mitigate the root cause of troubled world economics. Over population and consumerism gone out of control. 

  • Reply 48 of 105
    MacProMacPro Posts: 19,787member
    This is all there is to it. It is a pure artifact of the fact that most of the rest of (civilized) world uses something called the "territorial" system of taxation, whereby you are assumed to have met your tax obligations in the home country if you're paid it in the host country. For example, if a German company doing business in Singapore paid their (very low) taxes, German tax authorities treat is as taxes having been paid. The company is free to move its money about as it wishes, including back to Germany, with no additional tax penalties.

    The other system -- which the US, unfortunately, uses -- is called the "worldwide" taxation system. Your host country income is taxed at the home country rate when the money is brought back home. (On the flip side, you do get a tax credit if the host country has a higher corporate tax rate; sadly, the US has among the highest rate for any industrialized country -- most of the world taxes corporations at 20%, but the US rate is 34%).

    So what do you think rational US companies do with the profits they earn abroad? They don't bring it home. Every US multinational does it, not just Apple.

    If the US has a fiscal mess, it's totally because of its f'ed up fiscal policies. The problem could be got rid of in one stroke if Obama and the Congress could move to the territorial taxation system that most of the industrialized world uses.

    Fascinating. Thanks I always wondered what tf was going on as it seemed to me Apple was paying where earned and paying again seemed weird, I didn't understand the US operated under a different system from Europe.
  • Reply 49 of 105
    MacProMacPro Posts: 19,787member
    jk7117 wrote: »

    Exactly right. And what does our current President do after getting his increased taxes in January 2013, he submits a budget with more increased spending and higher taxes. My question is that no one answers is how much spending is enough for this government? And let's not forget the monstrosity un-affordable care act, that was suppose to save us all money, we'd get keep our current doctor and more people will be insured, oh guess what none of that is happening, it's just the opposite. So now the people who pushed that complete POS are saying they need more money to fund it, surprise, surprise.

    Oh please ... Take this to a political blog!
  • Reply 50 of 105
    jragostajragosta Posts: 10,473member
    cnocbui wrote: »

    I wonder, is the actual tax rate closer to 30% than your 300% exaggeration ..hmmmm?

    The US government should just change the law so that the tax is payable now - repatriated or not - and make it retrospective for the last 10 years - job done.  National debt reduced slightly.

    That would be insanely stupid - and violate virtually every trade law on the books.

    The money overseas was earned overseas. The expenses were paid overseas and whatever was left over is profit that was earned overseas. The US has absolutely no jurisdiction over things that occur in other countries.

    If you want to start down that path, why not start to tax car owners in Germany? Or punish companies who follow local health and safety rules rather than US rules? Or go arrest all those legal drug users and prostitutes in the Netherlands?

    Every country has its own rules and has a near-absolute right to do whatever they want within their borders. The US has no right to interfere.
    jungmark wrote: »
    Apple paid 6 billion. In any case both parties work for corporations and not us.

    Which probably made it the largest taxpayer in the country. IIRC, Apple paid several percent of ALL corporate income taxes last year. Arguing that they didn't pay their fair share is absurd.
    jk7117 wrote: »

    Exactly right. And what does our current President do after getting his increased taxes in January 2013, he submits a budget with more increased spending and higher taxes. My question is that no one answers is how much spending is enough for this government? And let's not forget the monstrosity un-affordable care act, that was suppose to save us all money, we'd get keep our current doctor and more people will be insured, oh guess what none of that is happening, it's just the opposite. So now the people who pushed that complete POS are saying they need more money to fund it, surprise, surprise.

    Maybe you should start getting information from places other than Fox News. The "democrats spend like drunken sailors' meme is just plain wrong.

    During the past 50 years, government spending has increased more under Republican administrations than under Democratic administrations.

    And if you look at the Obama record, if you ignore the first year (when government spending was controlled by the previous administration's budget and which he had no control over), government spending has increased less under Obama than under any administration in the past 40 years.
  • Reply 51 of 105
    kpluckkpluck Posts: 500member

    Quote:

    Originally Posted by dysamoria View Post





    This is why the USA is in debt and the economy is in the toilet.


     


    The US is in debt because of too much spending not because of not enough taxes. It is no different than when a highly paid professional athlete has to file for bankruptcy. But I suppose in those cases you would blame the athlete's team for not paying him enough.


     


    -kpluck

  • Reply 52 of 105
    trumptmantrumptman Posts: 16,464member

    Quote:

    Originally Posted by zoetmb View Post




    Quote:

    Originally Posted by igriv View Post



    In the same way as it is allowed for me to go 200mph on I95, if I am willing to pay a massive fine.




    It's not the same at all. When you speed, you break the law. The fine is because of that.



    Apple's strategy is not breaking current law, but it is breaking the spirit of the purpose of the tax code and the economy.



    Almost no Fortune 500 companies pay Federal taxes most years. This is why the country is broke. Our Congress, especially Republicans, are like Leona Helmsly. She said, "pay taxes? Only the little people pay taxes," but she went to jail for it (for not paying taxes, not for the statement).


     


    Quote:

    Originally Posted by mstone View Post




    Quote:

    Originally Posted by anantksundaram View Post


    This is all there is to it.


     


    [...]


     


    If the US has a fiscal mess, it's totally because of its f'ed up fiscal policies. The problem could be got rid of in one stroke if Obama and the Congress could move to the territorial taxation system that most of the industrialized world uses.



    In case you haven't noticed the entire world has a fiscal mess on their hands. This single policy change would do very little to mitigate the root cause of troubled world economics. Over population and consumerism gone out of control. 



     


     


    His point about taxation stands. Apple pays taxes when they make their products. They pay taxes when they pay their employees. They pay taxes when they earn a profit. They pay taxes again when they pay a dividend and finally they are told they should pay taxes when they move the monies that would make those profits and dividends from one country to another.


     


    The problem isn't that they don't pay enough taxes.

  • Reply 52 of 105
    MacProMacPro Posts: 19,787member
    jragosta wrote: »
    That would be insanely stupid - and violate virtually every trade law on the books.

    The money overseas was earned overseas. The expenses were paid overseas and whatever was left over is profit that was earned overseas. The US has absolutely no jurisdiction over things that occur in other countries.

    If you want to start down that path, why not start to tax car owners in Germany? Or punish companies who follow local health and safety rules rather than US rules? Or go arrest all those legal drug users and prostitutes in the Netherlands?

    Every country has its own rules and has a near-absolute right to do whatever they want within their borders. The US has no right to interfere.
    Which probably made it the largest taxpayer in the country. IIRC, Apple paid several percent of ALL corporate income taxes last year. Arguing that they didn't pay their fair share is absurd.
    Maybe you should start getting information from places other than Fox News. The "democrats spend like drunken sailors' meme is just plain wrong.

    During the past 50 years, government spending has increased more under Republican administrations than under Democratic administrations.

    And if you look at the Obama record, if you ignore the first year (when government spending was controlled by the previous administration's budget and which he had no control over), government spending has increased less under Obama than under any administration in the past 40 years.

    Again, excellent post, thank you.
  • Reply 54 of 105
    trumptmantrumptman Posts: 16,464member

    Quote:

    Originally Posted by jragosta View Post



    Maybe you should start getting information from places other than Fox News. The "democrats spend like drunken sailors' meme is just plain wrong.



    During the past 50 years, government spending has increased more under Republican administrations than under Democratic administrations.



    And if you look at the Obama record, if you ignore the first year (when government spending was controlled by the previous administration's budget and which he had no control over), government spending has increased less under Obama than under any administration in the past 40 years.


     


    It isn't wrong and perhaps you should get your information from someplace other than MSNBC and Huffington Post. Spending comes from Congress. The Democrats controlled Congress during most Republican presidential terms. Even during the latest Republican president, George W. Bush, the Senate was controlled by Democrats during 4 of the 8 years. To compare spending by party, you have to look at control of Congress, not just the presidency.


     


    The first year under the Obama record counts against Obama because Democrats knew there was a chance of a Democratic president and thus did not pass the bills for Bush to sign. Out of the 12 major appropriation bills for 2009, Bush signed four and Obama signed the remaining 8. Obama has made the level of spending that was supposed to be associated with a temporary stimulus to now be a norm along with trillion dollar a year deficits. He has borrowed more in five years than Bush borrowed in eight and will have borrowed more than all prior presidents combined including Bush.

  • Reply 55 of 105
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by trumptman View Post




    His point about taxation stands. Apple pays taxes when they make their products. They pay taxes when they pay their employees. They pay taxes when they earn a profit. They pay taxes again when they pay a dividend and finally they are told they should pay taxes when they move the monies that would make those profits and dividends from one country to another.


     


    The problem isn't that they don't pay enough taxes.



    Except that wasn't his point as far as I can tell, at least not the point I was responding to. Changing the policy on taxing foreign earned profit is not in any appreciable way going to fix the US economy or the world economy because that aspect of world trade has almost nothing to do with the root causes of the  financial mess that the entire world is facing.

  • Reply 56 of 105
    bobringerbobringer Posts: 106member

    Quote:

    Originally Posted by dysamoria View Post





    This is why the USA is in debt and the economy is in the toilet. The whole system is insane. This is the "self regulating" economy. Bunch of BS. Why exactly should I love my country for being obsessed with self-destructive, antisocial, sociopathic, greedy stupidity?


     


    How many countries tax income when repatriating after tax has already been collected locally?


     


    You might want to know the answer to this question before you call American capitalists self-destructive and greedy.

  • Reply 57 of 105
    anantksundaramanantksundaram Posts: 20,407member

    Quote:

    Originally Posted by trumptman View Post




    Spending comes from Congress. The Democrats controlled Congress during most Republican presidential terms. Even during the latest Republican president, George W. Bush, the Senate was controlled by Democrats during 4 of the 8 years. To compare spending by party, you have to look at control of Congress, not just the presidency.



    1) Presidents have the right to veto. At no time was the Democratic control of Congress sufficient to overcome a veto.


     


    2) Why don't you compare spending in Congresses under the two parties, compare, and come back and tell us what you find empirically. (Hint: You might be surprised).

  • Reply 58 of 105
    websnapwebsnap Posts: 224member

    Quote:

    Originally Posted by jungmark View Post



    Now that Apple has debt, it is apparently more valuable in enterprise value terms. Doesn't make any sense.


     


    Oddly enough, it does... especially for a very secretive company like apple because debt reduction is long term plan and investors love those.

  • Reply 59 of 105
    anantksundaramanantksundaram Posts: 20,407member

    Quote:

    Originally Posted by mstone View Post


    Except that wasn't his point as far as I can tell, at least not the point I was responding to. Changing the policy on taxing foreign earned profit is not in any appreciable way going to fix the US economy or the world economy because that aspect of world trade has almost nothing to do with the root causes of the  financial mess that the entire world is facing.


    That wasn't my main point (it was just a throwaway statement), but never mind.

  • Reply 60 of 105


    Of course this is a good thing why would Apple hand over $9B to the US gov't when all they want to do is return money to shareholders.  And Apple is the most widely held stocks in the US it's not dominated by hedge funds.

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