Apple CEO Tim Cook calls US tax code outdated and 'awful for America'

Posted:
in General Discussion edited December 2015
The full interview between Charlie Rose and Apple Chief Executive Tim Cook will air this Sunday, but CBS has posted a teaser clip from the conversation, in which Cook again defended his company's tax policies, stating that they pay more than any other company in a "backwards" system.


Credit: CBS.


Cook's aggressive comments are even more forceful than some he has made in the past, but the message remains the same: Apple pays every dollar it owes, and does not illegally avoid any U.S. taxes. He said the same more than two years ago, when he testified before the U.S. Congress.

Cook's latest comments will air on broadcast television this Sunday on 60 Minutes, and a minute-long clip from the interview was shared online on Friday. During the conversation with Rose, Cook noted that his company pays more taxes than anyone else in the U.S.

"We happily pay that," he said.

The question, however, centers around the money Apple earns overseas. More than $200 billion of it rests internationally, because repatriation taxes are excessively high, in the eyes of Cook and many other business executives.

Cook told Rose that he would "love to bring it home," but current policies are outdated and unfair.

"It would cost me 40 percent to bring it home, and I don't think that's a reasonable thing to do," Cook said. "This is a tax code, Charlie, that was made for the industrial age, not the digital age. It's backwards. It's awful for America. It should have been fixed many years ago. It's past time to get it done."

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After he testified before Congress in 2013, some politicians concluded that Apple was involved in a "scheme" to pay little or no taxes to the U.S. When questioned about that conclusion by Rose, Cook responded fiercely.

"That is total political crap," he said. "There is no truth behind it. Apple pays every tax dollar we owe."

Apple has been a vocal proponent of corporate tax reform in the U.S., but it's also faced scrutiny overseas. The European Union is in the midst of an investigation into Apple's tax practices, though Apple has also steadfastly denied allegations that it avoids taxes in Europe as well.
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Comments

  • Reply 1 of 132
    gatorguygatorguy Posts: 23,175member
    Cook told Rose that he would "love to bring it home," but current policies are outdated and unfair.

    "It would cost me 40 percent to bring it home, and I don't think that's a reasonable thing to do," Cook said.
    ??

    If the US rate is 35%, less the corporate taxes already paid overseas in the country of origin, it couldn't be anywhere close to 40% to bring it home could it? Am I missing something?
    edited December 2015
  • Reply 2 of 132
    Stop the presses!  "Famous Rich Guy Thinks Taxes are Bad!"  "Wealthiest Company in the History of Human Existence, Wants a Tax Break!"  

    Has there ever been a billionaire who didn't think the tax laws were bad or outdated?  
    frankiejahbladewilliamlondonjustbobfapplepieguy
  • Reply 3 of 132
    Stop the presses!  "Famous Rich Guy Thinks Taxes are Bad!"  "Wealthiest Company in the History of Human Existence, Wants a Tax Break!"  

    Has there ever been a billionaire who didn't think the tax laws were bad or outdated?  

    American investor Warren Buffett, who publicly stated in early 2011 that he believed it was wrong that rich people, like himself, could pay less in federal taxes, as a portion of income, than the middle class, and voiced support for increased income taxes on the wealthy.

    bloggerblogfrankiejahbladecnocbuih2pjustbobfthepixeldocapplepieguy
  • Reply 4 of 132
    Stop the presses!  "Famous Rich Guy Thinks Taxes are Bad!"  
    youre reading it wrong. Cook didnt say taxes are bad, and said he's happy for Apple to be the largest tax payer in the US. please cite your claim.

    what Cook doesnt want is for Apple to give the feds 40% of the profit from goods they built and sold overseas. i dont see that being different than my US friends who work overseas and dont want to or dont pay US income tax.
    edited December 2015 snovanostrathomasadoniramh2pjbdragon
  • Reply 5 of 132
    gatorguy said:
    Cook told Rose that he would "love to bring it home," but current policies are outdated and unfair.

    "It would cost me 40 percent to bring it home, and I don't think that's a reasonable thing to do," Cook said.
    ??

    If the US rate is 35%, less the corporate taxes already paid overseas in the country of origin, it couldn't be anywhere close to 40% to bring it home could it? Am I missing something?
    The 40% refers to the combined U.S. federal(35%) and state tax rate(5%) Apple would likely owe.
    snovaadoniramjbdragon
  • Reply 6 of 132
    flaneurflaneur Posts: 4,526member
    Stop the presses!  "Famous Rich Guy Thinks Taxes are Bad!"  "Wealthiest Company in the History of Human Existence, Wants a Tax Break!"  

    Has there ever been a billionaire who didn't think the tax laws were bad or outdated?  
    Sorry, you're taking a very childish approach here. In case you haven't been paying attention — at all! — Tim Cook is not a typical rich guy, and Apple is not a typical corporation. 

    Deal with the facts. Thirty-five per cent is ridiculous, outdated, in the age of global economy.
    justadcomicskpomadoniramequality72521latifbph2pjbdragonthepixeldoc
  • Reply 7 of 132
    flaneurflaneur Posts: 4,526member

    gatorguy said:
    Cook told Rose that he would "love to bring it home," but current policies are outdated and unfair.

    "It would cost me 40 percent to bring it home, and I don't think that's a reasonable thing to do," Cook said.
    ??

    If the US rate is 35%, less the corporate taxes already paid overseas in the country of origin, it couldn't be anywhere close to 40% to bring it home could it? Am I missing something?
    Yes. If it's between you and Tim Cook, yes.
  • Reply 8 of 132
    gatorguygatorguy Posts: 23,175member
    flaneur said:

    gatorguy said:
    Cook told Rose that he would "love to bring it home," but current policies are outdated and unfair.

    "It would cost me 40 percent to bring it home, and I don't think that's a reasonable thing to do," Cook said.
    ??

    If the US rate is 35%, less the corporate taxes already paid overseas in the country of origin, it couldn't be anywhere close to 40% to bring it home could it? Am I missing something?
    Yes. If it's between you and Tim Cook, yes.
    And what fact would that be good sir? 
  • Reply 9 of 132
    gatorguy said:
    Cook told Rose that he would "love to bring it home," but current policies are outdated and unfair.

    "It would cost me 40 percent to bring it home, and I don't think that's a reasonable thing to do," Cook said.
    ??

    If the US rate is 35%, less the corporate taxes already paid overseas in the country of origin, it couldn't be anywhere close to 40% to bring it home could it? Am I missing something?
    The base rate of US corporate taxes is substantially more than overseas taxes.  If a corporation does not need to bring the money back to the US then there is no motivation to pay a penalty (US taxes - easily 20% - 40% might be stretching it) and bring it back.... just invest it inside one of your corporations offshore and when you need the money somewhere then move it (not likely needed back in the US).  If there was not a penalty then the corporation would probably repatriate it and invest it in different securities/bonds/treasuries until they have a need for it.    

    It would be better to do away with the corporate income tax and just charge a VAT on all goods and services sold in the US.  Whether the money is collected from profit then added to the markup of manufactured goods, or after when it goes on sale - it in the end comes out of the consumers pockets sometime.  If you charge a VAT then you will end up making sure the tax cannot be moved around through services by other wholly owned companies and paying very little in the US.  Also you would in essence be exporting goods and services free of taxes making the US much more competitive and eventually making manufacturing in the US more attractive.  Apple probably has almost 200 billion dollars invested elsewhere because there it would cost them to bring it back to the US and then sit in bank and investment accounts in the US.  Essentially the US is making it more attractive for corporations to keep trillions of dollars invested in other countries.  Nuts!
    adoniramcornchiph2p
  • Reply 10 of 132
    gatorguygatorguy Posts: 23,175member

    shahhet2 said:
    gatorguy said:
    Cook told Rose that he would "love to bring it home," but current policies are outdated and unfair.

    "It would cost me 40 percent to bring it home, and I don't think that's a reasonable thing to do," Cook said.
    ??

    If the US rate is 35%, less the corporate taxes already paid overseas in the country of origin, it couldn't be anywhere close to 40% to bring it home could it? Am I missing something?
    The 40% refers to the combined U.S. federal(35%) and state tax rate(5%) Apple would likely owe.
    Still doesn't account for the taxes Apple already paid on those profits. Surely Apple paid something on it already and that would be deducted from what is stilled owed to the US, right? For example if they paid 12% to the Irish the remaining corporate taxes owed to the Feds would be 23% if they brought it home. If Cook's comment was close to accurate it would presume they've paid nothing to anyone. That's why 40% doesn't sound like it could possibly be right.  
    edited December 2015
  • Reply 11 of 132
    Cook is correct about the tax code being onerous and anti-business, but he supports and pals around with those politicians who would most likely drain all US companies of their combined wealth to grow government. Tim needs to re-think the people and party he supports. Even Steve Jobs supported irresponsible Democrat policies, while acting like a responsible businessman.
    edited December 2015 h2pjbdragon
  • Reply 12 of 132
    gatorguy said:

    shahhet2 said:
    The 40% refers to the combined U.S. federal(35%) and state tax rate(5%) Apple would likely owe.
    Still doesn't account for the taxes Apple already paid on those profits. Surely Apple paid something on it already and that would be deducted from what is stilled owed to the US, right? For example if they paid 12% to the Irish the remaining corporate taxes owed to the Feds would be 23%.
    Yes I believe he was referring that in general overall tax of 40% ridiculous.

    Obviously any company have to pay only the difference of 40%  - paid taxes, but overall 40% tax for profit that was  earned outside US is not favored by any corporation.
    That's my understanding.
    edited December 2015 anantksundaramradarthekatjbdragon
  • Reply 13 of 132
    hmlongco said:
    Stop the presses!  "Famous Rich Guy Thinks Taxes are Bad!"  "Wealthiest Company in the History of Human Existence, Wants a Tax Break!"  

    Has there ever been a billionaire who didn't think the tax laws were bad or outdated?  

    American investor Warren Buffett, who publicly stated in early 2011 that he believed it was wrong that rich people, like himself, could pay less in federal taxes, as a portion of income, than the middle class, and voiced support for increased income taxes on the wealthy.

    Warren Buffet toes the party line to continue to receive favorable treatment in Washington. He can spout any nonsense he wants, knowing full well that what he claims he supports is unworkable:  http://tomwoods.com/blog/if-we-make-the-rich-pay-their-fair-share-would-that-fix-things/
    edited December 2015 equality72521h2pjbdragon
  • Reply 14 of 132

    shahhet2 said:
    gatorguy said:

    Still doesn't account for the taxes Apple already paid on those profits. Surely Apple paid something on it already and that would be deducted from what is stilled owed to the US, right? For example if they paid 12% to the Irish the remaining corporate taxes owed to the Feds would be 23%.
    Yes I believe he was referring that in general overall tax of 40% ridiculous.

    Obviously any company have to pay only the difference of 40%  - paid taxes, but Why overall 40% for profit earned outside.
    That's my understanding.
    Also most of Europe profit is routed through Ireland at 2% rate, so to bring that profit back AAPL have to pay 38%(40%-2% Ireland Tax) of Tax. 
    China should be reasonable at 15% difference.(40%-25% China Tax)
    edited December 2015
  • Reply 15 of 132
    Though I have little stomach for taxes, as tax money is always used nationally for unconstitutional and/or militaristic and/or corporatist purposes, one of the few ways forward available to America would be the immediate adoption of the Fair Tax and elimination of all write-offs and subsidies of all kinds for industries, special interests and taxpayers. Also, this would enable the shutdown and elimination of the IRS.

    FairTax.org
    edited December 2015 frankieIanMC2jbdragon
  • Reply 16 of 132
    mr. hmr. h Posts: 4,819member
    Apple has also steadfastly denied allegations that it avoids taxes in Europe as well.
    You mean “evades” here. It is clear that Apple avoids plenty of tax in Europe, totally legally and as is its right.
    SpamSandwichsnovafrankiecnocbuijbdragon
  • Reply 17 of 132
    sflocalsflocal Posts: 5,737member
    Tim Cook is absolutely correct in his statements, regardless of what the freetards are saying.  All that money overseas has had its taxes paid for in the country the revenue was generated in.  For the US to essentially "extort" Apple for the "honor" of bringing the money back into the US is complete BS.  It makes zero sense.  The US is one of the very, very few countries doing double-taxation.  I hope Apple keeps that money overseas to spite the government.  

    The tax code needs updating.  Period.  We're a global economy now, and we're still paying taxes based on a an archaic system.
    snovalymfflaneurequality72521jbdragon
  • Reply 18 of 132
    bobschlobbobschlob Posts: 1,074member
    Stop the presses!  "Famous Rich Guy Thinks Taxes are Bad!"  
    youre reading it wrong. Cook didnt say taxes are bad, and said he's happy for Apple to be the largest tax payer in the US. please cite your claim.

    what Cook doesnt want is for Apple to give the feds 40% of the profit from goods they built and sold overseas. i dont see that being different than my US friends who work overseas and dont want to or dont pay US income tax.
    Reading it wrong??  Clearly that guy wasn't reading at all.
  • Reply 19 of 132
    I'm not sure arguing over the current tax code helps much. Talking about what occurs because of it is so much more important. Just look at what companies are doing.

    They leave profits overseas
    Buy companies overseas with their offshore funds
    Expand their operations overseas with their offshore funds
    Sell Bonds in the US to pay Dividends to Shareholders
    Complain about the repatriation Taxes

    The key point missing from the list is "Bring profits from overseas back to US". If they won't bring it back, we need to fix the system so that they will. Why is the US against businesses bringing money to the US that they earned overseas? With an estimated 2 Trillion overseas doing nothing for the American economy, you would think we could get this fixed. Leaving the existing tax code in place which forces the money (and most importantly the investments that occur with this money) to stay outside the US is just wrong. 


    kpomalandailfrankiejbdragon
  • Reply 20 of 132
    Also, this would enable the shutdown and elimination of the IRS.
    Or not. Someone would still have to make sure that you or your company paid the 10% (or whatever) flat tax owed and collect from those who're unwilling to pay their share.
    justbobf
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