Apple CEO Tim Cook calls EU tax ruling 'total political crap,' cites potential anti-US sentiment

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  • Reply 81 of 201
    gatorguygatorguy Posts: 23,301member
    gatorguy said:
    gatorguy said:
    Um, I was taking about the retained earnings abroad, and the fact that it will be brought back. 

    It'll simply be be returned to shareholders instead of being invested in real assets. 
     
    Oh. When you said "They will never see the counterfactual of the trillions that don't get invested there in the future by US corporations" it sounded as tho you were talking about something other than retained earnings.

    So those $Trillions in retained earnings are invested in the EU now? As an example didn't reports awhile back say Apple was mostly buying US Treasury's and other very safe but low-return (1%?) securities with those "overseas" funds, keeping their money safely within the US borders? Remember the Braeburn story a few months ago? If accurate those foreign funds are invested in the US more so than the EU aren't they? I suspect Google's cash, MS cash, and others are handled similarly, placed in low-risk investments like US Treasury certificates IMHO. 
    Read in the context of post #42... 
    The key point is, it hasn't been returned to shareholders. 
    And you're saying $200B+ will be repatriated and returned to shareholders if the tax appeals are filed but fail? I'm sorry but you not being entirely clear on what point you are trying to make.

    Anyway, on a related note if the money for the most part is not being invested in Europe anyway then what is the EU loss if Apple were to move their no-tax/low-tax subsidiaries to some other region? You yourself agree they aren't going to stop selling Apple products to European buyers, and a sales structure and data centers are still needed in Europe to serve those Apple customers. 
    At some point, I can't connect every single dot for you. Sorry. 
    There's a reason for that. The dots are not there to connect. :)
  • Reply 82 of 201
    gatorguy said:
    gatorguy said:

    Apple had zero plans to ever 'bring it on home". Taxes on it were not deferred. 
    You are quite wrong about that. Cook is already suggesting that Apple will bring a lot of it back to the US in 2017. You can look it up, if you wish. 
    Some of it had taxes deferred. Those are the funds they expect to someday "bring home". At least $100B of it as of 2012, which at the time was the majority of Apple's cash holdings, was considered permanently invested overseas with no allowance for future US taxes. You can look it up for yourself if you're so certain I'm wrong. I think you find you are the one mistaken.  
    Your post makes no sense at all. I mean that in full honesty. I have no idea what you're talking about! And I think I know a little bit about this stuff. Are you taking about temporary differences or permanent differences? What part of those 'funds' is the former, what part the latter? Where can I find that distinction in Apple's financials?
  • Reply 83 of 201
    Tim Cook said Apple payed $400m in tax in Ireland. The EU said Apple payed 0.005% tax. To my understanding you pay tax on the profit. Then Apple should have had a profit of $400m/0.00005 = $8 trillion. I guess someone is lying or I'm bad at math? :-)
    anantksundaramasdasdpropodjony0
  • Reply 84 of 201
    radarthekatradarthekat Posts: 3,402moderator
    This ludicrous politically motivated and invasive ruling is why Brexit no longer has any opposition in Great Britain.  Ireland and the rest of Great Britain need to declare their sovereignty and independence from the socialist agenda of the rest of the European Union.  

    Next thing you know, the European commission will want Apple to subsidize Greece and Spain.

    The Department of Justice should punish Europe for this misadventure by prosecuting Volkswagen more aggressively - to the tune of a $75 BILLION fine.  Currently they are handing Volkswagen with kid gloves. But with this turn of events, this should greenlight a big stick punishment that would push Volkswagen to bankruptcy. Take that Europe.
    Volkswagen already had a big fine that was much more then any US company would have ever paid - how much did GM have to pay when they covered something up that actually killed a hundred people or so (ignition switch I think) - so talk about politically motivated. Same with fines for European banks which had to pay and no recourse. Americans always think that there are special rules only for them. If you want to read a balanced discussion of the tax issue than read: http://www.nytimes.com/2016/09/01/business/yesterday-outraged-by-apples-tax-dodge-today-by-its-tax-bill.html
    There is no 'balanced' in a headline that refers to tax deferral as 'dodging.' Tax deferral is exactly what everyone, including many at the Times, is doing in their 401(k). And the Times? Really? The paper that came out with the hit piece a few years ago against the company doing THE MOST to positively affect worker conditions in China? You'll recall, no mention of toaster factories, or tire factories, or thousands of factories that produce the low margin crap we all buy at Walmart, where worker conditions are necessarily deplorable, as there's no margins to effect change even if there were a will to do so.  Spare me the 'balanced' discussion brought by the New York Times.
    edited September 2016
  • Reply 85 of 201
    alexis said:
    gadgetdon said:
    I don't think that's a good argument for Tim Cook to make, that this is a grab for US taxes, because Apple doesn't PAY US Taxes on those profits and keeps it offshore to avoid paying US Taxes. 
    That's because the "repatriation tax" is 35%.  Thirty-five percent!!!  
    Nonsense. It is not 35%. It is only the difference between the rate paid abroad and the 35%. I personally think (and have said so in this forum many times in the past year) that Apple should swallow its pride, pay the extra, and bring it back to the US. Repay the debt, pay the rest back to shareholders. Borrow in the future if/as/when needed. Get rid of all this tax-related crap. 
    Apple would be subject to many shareholder lawsuits if they did this. It's their legal and fiduciary responsibility to maximize profits and deliberately making a bad decision to placate complainers would be sufficient grounds to sue Tim Cook and their board of directors.
  • Reply 86 of 201
    gatorguygatorguy Posts: 23,301member
    Tim Cook said Apple payed $400m in tax in Ireland. The EU said Apple payed 0.005% tax. To my understanding you pay tax on the profit. Then Apple should have had a profit of $400m/0.00005 = $8 trillion. I guess someone is lying or I'm bad at math? :-)
    No it's neither one. You only got part of the story.

    Two things. Apple was forced to restructure in Ireland last year since their previous "stateless for tax purposes" structure is not now legal. That will have some impact on the taxes paid to the Irish from this year on I would think, but no idea if it will. 

    Secondly Apple has for years not counted the profits realized from it's two wealthiest Irish subsidiaries that registered the vast majority of the EU (and Australia?) profits over the years, $Billions upon $Billions. Why? Because Apple doesn't report those profits as being taxable, based on what may turn out to have been bad advice from the Irish tax officials they consulted. 

    As for the particulars of what Apple factually paid as opposed to what The EU says the effective rate is we could know how the computation was made when the full report is issued (Yup that's still to come). But that would assume Apple doesn't successfully lobby for lots of redacting that hides the figures before they are publicized, which of course is their right if for competitive reasons.
    edited September 2016 jony0
  • Reply 87 of 201
    radarthekatradarthekat Posts: 3,402moderator
    flabber said:
    Cook also agreed with comments made by U.S. Secretary of Treasury Jack Lew, who said the tax ruling is a blatant grab at taxes owed to the U.S. government. "I think that's exactly what it is," Cook said. "I think it's a desire to reallocate taxes that should be paid in the U.S. to the EU."

    The above part is complete and utter BS. Yes, Apple and Ireland made agreements on the amount of tax that Apple would have to pay if they'd choose to use Ireland as their Eu-base of operations. But in no way is that tax owed to the US government. Technically it's not owed to anyone since there's an agreement. But even íf there's tax owed to anyone, then Ireland and Apple need to specify what amount of profit/income was made based on EU-sales. Because there's no way that áll of the taxes made in Ireland, are owed to the US government.

    Having said that: I despise the EU for charging outrageous taxes like that. Ireland made a deal with Apple to improve Ireland's economy. That was done befóre the EU made a vow to stop tax-deals in the EU. If the EU implements these plans after Ireland's deal with Apple, they need to take it up with Ireland. Apple shouldn't be involved or punished for political turbulence (in the EU in this case).

    I despise the EU, even more so because of how they try to punish companies for deals made with countries. But I think Apple is completely missing the point here. Just because you paid 400mil in taxes doesn't mean you're paying a proper amount. 0,005% is still 0,005%, and not the norm for most other companies in Ireland. And the US government certainly doesn't have any right to taxes made by products sold to EU citizens.
    I generally agree except for the point you make regarding Ireland making a deal with Apple and the EU changing the rules afterwards. These was a rule in place that said that governments have their own tax authority BUT (Except) that they have to give exactly the same deal to everyone.
    You seem not to be aware that 31 years ago Apple was not the huge company it is today. That it was near bankruptcy, and therefore had no significant sway with Ireland or anywhere else. That the tax status put in place at that time and that has endured since certainly was available to any company, as you'll soon see. Amazon and MacDonald's are next in the EU Competition Committee's crosshairs for this same issue, and the list of businesses that apply the same tax structure as Apple in Ireland is long. By definition, that deal was open to all, and taken by many.
    jony0
  • Reply 88 of 201
    jungmarkjungmark Posts: 6,882member
    I listened to Tim Cook trying to defend Apple's pitifully low tax rate on the BBC news this morning and it just sounded bad. Very bad PR. Attacking the EU is very unwise. All the people whose businesses pay tax at 20% are looking at this and saying why should Apple pay tax at less than 1%.
    As a life-long Apple evangelist, even I find this Apple hard to swallow.
    That's foolish. Apple paid what they were required to pay. The EU can't override Ireland nor should it. It also can't change the rules of the game after it's been played. 
    jony0
  • Reply 89 of 201
    sricesrice Posts: 119member
    dacloo said:
    Pay taxes like anyone else, Tim Cook, and shut up.
    Glad you're creating jobs, but so is anyone else and they have to pay double digit taxes, not less than 1%.

    What an arrogant attitude. 
    This is probably a good time to repeat myself:

    The EU has a VAT - value added tax system, where the taxes are allocated based on where the value to the product was added. 

    They do not have a sales tax based system.

    No value is added in the EU, they are just a consumer.  So the taxes should rightfully be applied upstream - either to the US, where the product was designed and developed, or in China where the product was built. (or Ireland where the R&D is performed *cough*). 
  • Reply 90 of 201
    This shouldn't come as any surprise it has been going on for years.

    To quote from the rather enlightening article linked to below:

    "They have been gathering information about Apple's Irish operations on suspicion that the group is aggressively – though legally – shifting profits from operations around the world, particularly from the US, to Ireland in order to pay less tax."

    https://www.theguardian.com/technology/2013/may/29/apple-ireland-cork-cathy-kearney
    edited September 2016
  • Reply 91 of 201
    I listened to Tim Cook trying to defend Apple's pitifully low tax rate on the BBC news this morning and it just sounded bad. Very bad PR. Attacking the EU is very unwise. All the people whose businesses pay tax at 20% are looking at this and saying why should Apple pay tax at less than 1%.
    As a life-long Apple evangelist, even I find this Apple hard to swallow.
    It is called envy. 
    Yes, Apple is smart in optimising their taxes. All other smart companies did the same as Apple. And paid the same taxes as Apple.

    Now, those who didn't do it, envy them. And since Apple is one of the biggest players, they express that envy through hate directed at Apple.

    This is like the kid of wealthy parents in a school - bullies take (want to) take the money from him/her.
    The same is in this case - EU is the bully and want to punish one of smart companies for optimising their taxes.
  • Reply 92 of 201
    gatorguygatorguy Posts: 23,301member
    gatorguy said:
    gatorguy said:

    Apple had zero plans to ever 'bring it on home". Taxes on it were not deferred. 
    You are quite wrong about that. Cook is already suggesting that Apple will bring a lot of it back to the US in 2017. You can look it up, if you wish. 
    Some of it had taxes deferred. Those are the funds they expect to someday "bring home". At least $100B of it as of 2012, which at the time was the majority of Apple's cash holdings, was considered permanently invested overseas with no allowance for future US taxes. You can look it up for yourself if you're so certain I'm wrong. I think you find you are the one mistaken.  
    Your post makes no sense at all. I mean that in full honesty. I have no idea what you're talking about! And I think I know a little bit about this stuff. Are you taking about temporary differences or permanent differences? What part of those 'funds' is the former, what part the latter? Where can I find that distinction in Apple's financials?
    Does a company make an allowance for US deferred taxes on funds that are permanently invested overseas? I don't believe so. Why would they? Permanent outside of US hands is certainly not temporary.

    I agree you know a little about this stuff, but you still might benefit by looking into it more if you want to be so certain of your position. I myself have but I remember you don't like, or at least have time for, following links I offer you. So just look it up when you have the free time. I will give you a hint on where to start looking tho.  First find Apple's 10K for fiscal 2012 (ending Sept/12), and secondly Apple's 10Q that covered the first half of 2013 (ending March/13)
    edited September 2016
  • Reply 93 of 201
    sensisensi Posts: 346member
    Bla bla bla
    Your inane and childish comments are always standing apart from the rest (well beside "apple ][" ludicrous drivels) because of their utter vacuity... I can only hope that you don't dare to vote...

    GDP PPP, IMF, estimate 2016 (Millions of Int$):
    EU: 19,205,364
    US: 
    18,558,129

    https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)
  • Reply 94 of 201
    urahara said:
    I listened to Tim Cook trying to defend Apple's pitifully low tax rate on the BBC news this morning and it just sounded bad. Very bad PR. Attacking the EU is very unwise. All the people whose businesses pay tax at 20% are looking at this and saying why should Apple pay tax at less than 1%.
    As a life-long Apple evangelist, even I find this Apple hard to swallow.
    It is called envy. 
    Yes, Apple is smart in optimising their taxes. All other smart companies did the same as Apple. And paid the same taxes as Apple.

    Now, those who didn't do it, envy them. And since Apple is one of the biggest players, they express that envy through hate directed at Apple.

    This is like the kid of wealthy parents in a school - bullies take (want to) take the money from him/her.
    The same is in this case - EU is the bully and want to punish one of smart companies for optimising their taxes.
    So you're saying you don't believe in a level playing field for large and small companies?

    Small companies cannot afford the international accountants that exploit these loopholes.
  • Reply 95 of 201
    jungmarkjungmark Posts: 6,882member
    dacloo said:
    Pay taxes like anyone else, Tim Cook, and shut up.
    Glad you're creating jobs, but so is anyone else and they have to pay double digit taxes, not less than 1%.

    What an arrogant attitude. 
    Apple pays what they are required to pay. This is purely a money grab by the EU. 

    Im sure you look for deductions everywhere when you file your taxes. 
    dewmeanantksundaram
  • Reply 96 of 201
    dacloo said:
    Pay taxes like anyone else, Tim Cook, and shut up.
    Glad you're creating jobs, but so is anyone else and they have to pay double digit taxes, not less than 1%.

    What an arrogant attitude. 
    He has paid taxes like anyone else. Perhaps you should be the one to follow your advice about "shutting up."
    SpamSandwich
  • Reply 97 of 201
    alexis said:
    gadgetdon said:
    I don't think that's a good argument for Tim Cook to make, that this is a grab for US taxes, because Apple doesn't PAY US Taxes on those profits and keeps it offshore to avoid paying US Taxes. 
    That's because the "repatriation tax" is 35%.  Thirty-five percent!!!  
    Nonsense. It is not 35%. It is only the difference between the rate paid abroad and the 35%. I personally think (and have said so in this forum many times in the past year) that Apple should swallow its pride, pay the extra, and bring it back to the US. Repay the debt, pay the rest back to shareholders. Borrow in the future if/as/when needed. Get rid of all this tax-related crap. 
    Apple would be subject to many shareholder lawsuits if they did this. It's their legal and fiduciary responsibility to maximize profits and deliberately making a bad decision to placate complainers would be sufficient grounds to sue Tim Cook and their board of directors.
    Most shareholder lawsuits are bogus. It is a trivial mater compared to this global spat.
  • Reply 98 of 201
    radarthekatradarthekat Posts: 3,402moderator
    gatorguy said:
    gadgetdon said:
    I don't think that's a good argument for Tim Cook to make, that this is a grab for US taxes, because Apple doesn't PAY US Taxes on those profits and keeps it offshore to avoid paying US Taxes. It's reasonable to argue the ex post facto aspect of this ruling, question the authority - but I think going forward the really sweet deal for taxes is toast. Negotiate a shorter timespan for the back taxes (which means much less money owed) and declare victory.
    Apple does not avoid paying taxes, any more than anyone who has a 401(K) account avoids paying taxes.  It's called deferring taxes, and there's a huge difference between that and avoiding taxes.  Let's just get that straight.
    I believe financial reports have indicated that upwards of $100B+ in Apple cash does not have an allowance for deferred taxes. It's considered permanently invested overseas with no expectation of ever paying US taxes on it. If other regions where Apple bases operations also did not collect corporate taxes on the profits then hasn't Apple successfully avoided paying taxes, not even an allowance for deferred taxes? That was why Apple made mention in a previous 10K of potential material impact to Apple's finances from this investigation. No tax on the profits in two largest Irish units profits was previously allowed for either there or in the US. 

    Apple had zero plans to ever 'bring it on home". Taxes on it were not deferred. 
    It doesn't void my argument in any way that Apple never intended to bring back a portion of their overseas profits.  Because Apple continues to invest overseas.  For example, to create new Apple stores in China, you must create those store... in China.  Lol. So it makes sense that a portion of Apple's overseas profits would be earmarked for overseas investment; it would make zero sense to first repatriate those profits, pay a significant chunk in taxes, then go spend it in China, or to create an R&D facility in India.  2/3rds of Apple's revenue comes from overseas, and so it would make sense for a similar portion of its new capital investments to be made there.  

    But there is a portion of Apple's overseas profits that Apple would like to repatriate, and that portion is large enough that Apple has already borrowed some $60+ billion against it to defer its repatriation.  That $60+ billion of borrowings makes my point quite forcefully. 
    edited September 2016
  • Reply 99 of 201

    gatorguy said:
    gatorguy said:
    gatorguy said:

    Apple had zero plans to ever 'bring it on home". Taxes on it were not deferred. 
    You are quite wrong about that. Cook is already suggesting that Apple will bring a lot of it back to the US in 2017. You can look it up, if you wish. 
    Some of it had taxes deferred. Those are the funds they expect to someday "bring home". At least $100B of it as of 2012, which at the time was the majority of Apple's cash holdings, was considered permanently invested overseas with no allowance for future US taxes. You can look it up for yourself if you're so certain I'm wrong. I think you find you are the one mistaken.  
    Your post makes no sense at all. I mean that in full honesty. I have no idea what you're talking about! And I think I know a little bit about this stuff. Are you taking about temporary differences or permanent differences? What part of those 'funds' is the former, what part the latter? Where can I find that distinction in Apple's financials?
    Does a company make an allowance for US deferred taxes on funds that are permanently invested overseas? I don't believe so. Why would they? Permanent is certainly not temporary.

    I agree you know a little about this stuff. You might benefit by looking into it more if you are so certain of your position. I have but I remember you don't like, or at least have time for, following links I offer you. Just look it up when you have the free time. I will give you a hint on where to start looking tho.  First find Apple's 10K for fiscal 2012 (ending Sept/12), and secondly Apple's 10Q that covered the first half of 2013 (ending March/13)
    Again, your post makes no sense at all. Do you know that deferred taxes cause only two two types of difference between disclosure books (what they say they paid) and tax books (what they actually paid)? Temporary and permanent. Please take a moment to understand what they mean, what types of transactions fall into which category, and then tell us how "Apple might keep its money abroad forever" (whatever the heck that means). 

    If anyone should be looking up some basic links, it is you I am afraid.

    Talk about not connecting dots (ref. your post #81 above). Sheesh...
  • Reply 100 of 201

    srice said:
    dacloo said:
    Pay taxes like anyone else, Tim Cook, and shut up.
    Glad you're creating jobs, but so is anyone else and they have to pay double digit taxes, not less than 1%.

    What an arrogant attitude. 
    This is probably a good time to repeat myself:

    The EU has a VAT - value added tax system, where the taxes are allocated based on where the value to the product was added. 

    They do not have a sales tax based system.

    No value is added in the EU, they are just a consumer.  So the taxes should rightfully be applied upstream - either to the US, where the product was designed and developed, or in China where the product was built. (or Ireland where the R&D is performed *cough*). 
    You can shout this from the rooftops, but the "let's burn the witch" mob here doesn't have a clue, or even if they did, are not listening.
    radarthekatdesignrjony0
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