Actually, Apple has paid significant tax already ....6 Billion dollars, soon to be 7 Billion. All to the good old US government. They are said to have paid almost 3% of the governments collected taxes. Not too shabby.What the government wants is to be able to tax Apple on it's worldwide profits (stuff not sold in USA). What Apple has done is to create a holding company to collect after tax profits from all over the world (minus the Americas) and put it into this Irish holding company to manage their investments. The profits on their investments is taxed by the US and paid by Apple. Apple are duty bound to their shareholders to maximize profits and minimize expenses. Taxes are an expense. Apple is only doing what they should rightfully be doing.You want to blame someone, blame the government that wastes so much money and mismanages the system and just keeps the printing presses rolling to cover up their mistakes (and handing out $$ to their friends and lobbyists.) It's a broken system, folks. It needs to be overhauled, if it isn't too late, already.
That's great. I don't think anyone is criticising anything about Apple's corporation tax on its profits in the USA.A
And I do blame the governments. I've said more than once that while I don't condone what Apple have set up, I think it's very clever and I don't blame them for doing it. But they have been allowed to do it via gaps in the international tax system and insufficient regulation of transfer pricing by governments. If you're going to applaud them for paying so much tax in the USA then can you not see that it is reasonable for citizens of other countries to say "hang on, why not us too?". And further to that, it is interesting to explore ideas for what needs to be done to prevent it, to Apple's detriment, without seeing such discussions as an attack on Apple itself but as an attack on aggressive tax avoidance in general.
In the US most of that is on the state level. What is the US government doing in return for the money they have earned. IP protection laws? In theory perhaps but in truth the laws are a mess the legal system slow etc. that someone can be a patent troll legally is horrid. And Cook had no issue pointing this out yesterday
Let's see if we can find a few things that your federal taxes pay for - that benefit companies:
The Federal government:
1. Pays a large part of the cost of educating our kids.
2. Pays a large part of the cost of roads, ports, airports, etc.
3. Pays to defend our country (which is an enormous portion of the total tax revenues). Without a Federal Government, you'd probably be speaking Russian. Or maybe Chinese.
4. Provides the backbone of a banking system which is the envy of the world
5. Provides for rules that regulate pollution, food production, and so on. WIthout the Federal government, you'd probably be sick from pollution and bad food.
6. Invests enormously in technology development. It would be nearly impossible to find any existing technologies that weren't funded, at least in part, by the Federal Government.
7. Patents and other laws which provide for IP protection - which allows companies to profit from their own innovation.
There are many more, but that's a start. Arguing that companies don't benefit from Federal expenditures is just plain absurd.
That's great. I don't think anyone is criticising anything about Apple's corporation tax on its profits in the USA.A
And I do blame the governments. I've said more than once that while I don't condone what Apple have set up, I think it's very clever and I don't blame them for doing it. But they have been allowed to do it via gaps in the international tax system and insufficient regulation of transfer pricing by governments. If you're going to applaud them for paying so much tax in the USA then can you not see that it is reasonable for citizens of other countries to say "hang on, why not us too?". And further to that, it is interesting to explore ideas for what needs to be done to prevent it, to Apple's detriment, without seeing such discussions as an attack on Apple itself but as an attack on aggressive tax avoidance in general.
Still waiting for your evidence that Apple's transfer pricing is unfair. (and why haven't you provided this evidence to the IRS? If you bring evidence of tax evasion to the IRS, you get a share of the tax collected). And if Apple is selling the phones to Apple US at just under the retail price, how did they generate $20 B in profits and $6 B in tax liability?
It is not a US issue that the EU laws allow them to use a country with a low tax rate
Agreed. It's an EU (and constituent) issue.
Tax havens however are a global issue, so I don't think that particular conversation needs to stop at the EU. Indeed it looks like it'll be a big topic at the G8, which probably means that nothing will happen for about a decade.
Let's see if we can find a few things that your federal taxes pay for - that benefit companies:
The Federal government:
1. Pays a large part of the cost of educating our kids.
2. Pays a large part of the cost of roads, ports, airports, etc.
3. Pays to defend our country (which is an enormous portion of the total tax revenues). Without a Federal Government, you'd probably be speaking Russian. Or maybe Chinese.
4. Provides the backbone of a banking system which is the envy of the world
5. Provides for rules that regulate pollution, food production, and so on. WIthout the Federal government, you'd probably be sick from pollution and bad food.
6. Invests enormously in technology development. It would be nearly impossible to find any existing technologies that weren't funded, at least in part, by the Federal Government.
7. Patents and other laws which provide for IP protection - which allows companies to profit from their own innovation.
There are many more, but that's a start. Arguing that companies don't benefit from Federal expenditures is just plain absurd.
Most of that could (and should) be done privately. Only defense (actual defense) and perhaps some pollution stuff arguably must be done through the government. IP protection is government granted monopoly and, arguably, isn't necessary either.
Still waiting for your evidence that Apple's transfer pricing is unfair.
I'm really not sure how I can providence any evidence better than them paying less than 1% corporation rate on the fortune in the Irish subsidiaries, and a similar effective tax rate throughout the whole of Europe. It's clear avoidance.
If you don't think that's unfair, well that's your call. I do. It deprives governments of revenue, creates unfair advantage over competitors, and rewards duplicitous practices.
Quote:
Originally Posted by jragosta
(and why haven't you provided this evidence to the IRS? If you bring evidence of tax evasion to the IRS, you get a share of the tax collected)
There is no suggestion of tax evasion. No one has alleged that Apple has done anything illegal. Besides which, I'm not even sure how I'd do that even if I did have the inclination; I'm not a US citizen.
Quote:
Originally Posted by jragosta
And if Apple is selling the phones to Apple US at just under the retail price, how did they generate $20 B in profits and $6 B in tax liability?
Apple aren't selling the phones to Apple US at just under the retail price. Not sure what you got that from, but it's not from me, I've never said that.
Except I didn't claim I don't have significant facts to draw upon. Perhaps not about the Roman empire specifically, yes. But there are plenty of examples besides them. Plus, you know, logical deduction.
At best, you've engaged in logical inference, not deduction, and an argument by analogy is as weak as the similarities between the situations. Since you've admitted you don't know enough about the Roman Republic or Empire, "to make a particular claim," one would expect that you wouldn't, rather than assert a flight of fancy and wishful thinking as "reasonable". How could it possibly be reasonable if you don't have sufficient knowledge to determine if it's reasonable? Even if you were correct, it would be nothing more than a lucky guess.
As Apple pointed out in the hearing, they set up the Irish division back in 1980, and what did not say is why. They did this at the time due to the fact the EU was hitting any product not produced in the EU with a 40% tariff. Apple choose Ireland because the had the unique tax incentive and the fact their unemployment was over 25% at time. Ireland was doing whatever they could to draw manufacturing company to Ireland so Apple jump on the deal. No one in our government was screaming at the EU for their 40% tariff for product made outside the US.
Apple had its factory there for a long time, even in the 90's when apple was downsizing and was about to layoff 50% of the workforce at the factory. The PM of Ireland came to Cupertino to visit the then CEO and explain to him what would happen to Apple business in the EU if they continue to layoff worker in Ireland. Needless to say those workers still had jobs, but apple completely shut down the Fremont CA factory, Again no one in our Government both US or CA said a word.
Here we are 2013 Apple is still operating the Ireland division, no longer as factory, so they must have stuck another deal with Ireland to shut that down, but according to Cook own testimony they employ 3000 people in Ireland to manage the EU business for them. Various people in the Senate panel keep saying or inferring that the Irish Division was a shell company and no one work there, they kept saying it even after Cooks comment they had 3000 people there. In typical government fashion ignore the facts when they do not back out your conclusions.
I have to say the Apple team handle themselves well and the Senator for the most part look like idiots
Since you admit that you don't know how the system works, why are you blathering about it at all?
And who is to say what a 'reasonable adjustment' is? Obviously, not someone who admits that he doesn't know how the system works.
The issue is far more complicated than you are implying. You are apparently unable to distinguish between income and assets.
I don't know every detail of the US tax system. From what I hear I doubt anyone does. That I admit that i don't know everything is a pretty poor reason to bash down any argument.
Thanks for graciously answering my question btw. Do you know the answer?
Quote:
Originally Posted by jragosta
Apple pays income tax where the income is earned - which is in compliance with tax laws around the world. If the effective tax rate in Ireland is 2% (or 0.0002%, for that matter), then no one outside of Ireland should have any say in the matter. Each country sets its own tax rates and it's not up to you to criticize them. If they don't want to charge ANY corporate income tax, that's their choice. (By the same token, why aren't you running around protesting that the states that don't charge sales tax are unfair?)
That would be fine if Apple's economic activity was indisputably in Ireland. The two subsidiaries AOI and ASI that book income for Apple in Ireland have no employees, and exist merely as logical facades to siphon off the illusion of where profits are made, precisely so that Apply can achieve a low tax rate. That's a misrepresentation of income, so it is very appropriate for other countries to question this arrangement. Ireland can set it's tax rate wherever it wants, but companies should not be allowed to pretend that things are happening in Ireland just to take advantage of that rate. That's almost the dictionary definition what they call "a loophole".
Also, while Ireland can set its tax laws however it wants, that doesn't mean it gets criticism immunity, and its bizarre rule about only charging corporation tax if the company is "controlled" from domestic territory is frankly bizarre, and clearly Apple has exploited that too.
I think states that don't charge sales tax are fine. Sales tax is a flat tax (or regressive, by some definitions as discussed in another thread). I prefer progressive ones.
Quote:
Originally Posted by jragosta
The issue here is what to do about bringing cash into the US which has been earned elsewhere.
Actually I don't think this thread has much to do with repatriation at all, I think it's to do with core problems with Ireland and the EU's tax regime. Maybe we've been talking at cross-purposes, which is why you seem to have misunderstood some of what I've said?
Quote:
Originally Posted by jragosta
The issue here is what to do about bringing cash into the US which has been earned elsewhere. It's essentially the same as if you buy a truck overseas and ship it here - it's an asset that is being transferred. In some states, you are required to pay sales tax in a situation like that, but not very many. If it's your truck and you bring it here, it remains your truck and you don't have to pay for it again. Similarly, the argument is that if Apple moves an asset (cash) from one place to another, it shouldn't be taxed since they've already paid tax where the asset was earned. Paying income tax again is double taxation. This is, of course, complicated by corporate structures where Apple may also be moving the asset from one entity to another - which can sometimes create tax liabilities. Either way, the argument that income earned in a different country should be taxed at the same rate as income earned in the US is suspect from the start.
There are certainly discussions that can be had, but the subsidiaries in Ireland have been set up in a deliberate way so that they don't owe corporation tax to any country. Apple is effectively channeling profits out of the taxation system. The threat of double taxation is being used as a weapon to allow zero taxation. I'm of the opinion that something should be done about that, whether it's in Ireland, the EU or the US.
I'm really not sure how I can providence any evidence better than them paying less than 1% corporation rate on the fortune in the Irish subsidiaries, and a similar effective tax rate throughout the whole of Europe. It's clear avoidance.
So you have no evidence that Apple has done anything wrong. They pay the taxes that are required by law. Where is teh tax evasion that you keep claiming?
If you don't think that's unfair, well that's your call. I do. It deprives governments of revenue, creates unfair advantage over competitors, and rewards duplicitous practices.
The government sets the tax rates. Apple pays the required taxes. How is it unfair or how are they depriving the government of revenues? The only way your argument makes sense is if all the money belongs to the government in the first place and they simply allow Apple to keep some. That's not the way it works.
There is no suggestion of tax evasion. No one has alleged that Apple has done anything illegal. Besides which, I'm not even sure how I'd do that even if I did have the inclination; I'm not a US citizen.
So you're not a US citizen, you have no idea how the tax laws work, and you are fond of making things up (such as your claims on transfer pricing). So why should anyone believe a word you say?
Apple aren't selling the phones to Apple US at just under the retail price. Not sure what you got that from, but it's not from me, I've never said that.
I'm really not sure how I can providence any evidence better than them paying less than 1% corporation rate on the fortune in the Irish subsidiaries, and a similar effective tax rate throughout the whole of Europe. It's clear avoidance.
It is avoidance. However do you think the Irish Government should get 12.5% of Apples ongoing worldwide profits - which may exceed 70% of all profits eventually? Cork isn't a shell company, and has some IP, and some devs - but Cupertino contributes 90%+ of IP. If you are concerned about the US, then the fact that Apple has low payments outside the US means more money can be repatriated. The formula is X-Y where X is the US corporation taxes and Y is taxes already paid worldwide. Who is losing out?
Quote:
If you don't think that's unfair, well that's your call. I do. It deprives governments of revenue, creates unfair advantage over competitors, and rewards duplicitous practices.
Which Government?
Personally I think that the money should go to where the IP is created but not at the same level as the (absurd) corporation tax which the US applies.
So you have no evidence that Apple has done anything wrong. They pay the taxes that are required by law. Where is teh tax evasion that you keep claiming?
I have never, once, ever, claimed Apple engages in tax evasion. Tax evasion is illegal. I have repeatedly stated that Apple is acting within the law. Please read what I'm writing and stop inserting your own words to set up a straw man.
Quote:
Originally Posted by jragosta
The government sets the tax rates. Apple pays the required taxes. How is it unfair or how are they depriving the government of revenues? The only way your argument makes sense is if all the money belongs to the government in the first place and they simply allow Apple to keep some. That's not the way it works.
I am not saying that Apple are acting unfairly. I have said that they are smart and acting legally, and it is the regulatory situation that is flawed. Please read what I'm writing and stop inserting your own words to set up a straw man.
Quote:
Originally Posted by jragosta
So you're not a US citizen, you have no idea how the tax laws work, and you are fond of making things up (such as your claims on transfer pricing). So why should anyone believe a word you say?
The only part of that which is true is that I'm not a US citizen. I am posting in a thread that is about Ireland and the EU, so I find it passingly relevant. Please read what I'm writing and stop inserting your own words to set up a straw man.
Quote:
Originally Posted by jragosta
No? It must have been the other Crowley in post #41 of this thread:
"Apple Operations International (Ireland) buys iPhones from Apple, or Foxconn in China at cost. Apple Operations International then sells those iPhones to Apple UK, Apple Germany, Apple France etc for close to the retail price."
See that list there. See where Apple US is? I can't, the only listed entities are European and Chinese (Taiwanese specifically). Please read what I'm writing and stop inserting your own words to set up a straw man.
Which Government?
Personally I think that the money should go to where the IP is created but not at the same level as the (absurd) corporation tax which the US applies.
There's no country in the world that does that. In general, income is taxed where it is earned. That is not always the same as where the IP is created.
Most of that could (and should) be done privately. Only defense (actual defense) and perhaps some pollution stuff arguably must be done through the government. IP protection is government granted monopoly and, arguably, isn't necessary either.
The argument is not "plain absurd."
I am curious as to how you see the world run 'privately'. Who would pay for infrastructure and how would the cost be distributed and on what basis. I suspect that taxation will quickly look like a simpler and more equitable way of providing essential services.
Again with your made up crap! Double tax implies being taxed twice. That's the definition of the word "double". That you can't wrap your head around the concept that you get to decide neither what is "significant" nor what is an acceptable amount of times to tax someone is YOUR problem.
In genuine answer to your bluster. Double taxation when used in the context of moral hazard implies that there's a danger that companies will be unduly punished. For them to be unduly punished they must have paid a significant amount of tax in the first place, for any "double" taxation to pose any real impediment.
Of course I understand the technical logical meaning of double taxation. But let's take a look at the real world here. Double taxation clearly isn't something that threatens to wipe out Apple's profits with two high waves of government profit seizure. How can I say that? Because their effective tax rate in Ireland is less than 1%.
But we don't have good roads, good schools or decent public safety net systems in place, so what good are our taxes? There is nobody in this country that can say our monies are being put to not only good use or even proper use.
So how do the countries who do have good roads, good education, good transportation, do it?
Let's see if we can find a few things that your federal taxes pay for - that benefit companies:
The Federal government:
1. Pays a large part of the cost of educating our kids.
2. Pays a large part of the cost of roads, ports, airports, etc.
3. Pays to defend our country (which is an enormous portion of the total tax revenues). Without a Federal Government, you'd probably be speaking Russian. Or maybe Chinese.
4. Provides the backbone of a banking system which is the envy of the world
5. Provides for rules that regulate pollution, food production, and so on. WIthout the Federal government, you'd probably be sick from pollution and bad food.
6. Invests enormously in technology development. It would be nearly impossible to find any existing technologies that weren't funded, at least in part, by the Federal Government.
7. Patents and other laws which provide for IP protection - which allows companies to profit from their own innovation.
There are many more, but that's a start. Arguing that companies don't benefit from Federal expenditures is just plain absurd.
Quote:
Originally Posted by hmm
You're parroting the same thing, yet you ignore the fact that these companies depend on the court system, banking system, military, and diplomatic work. Perhaps you should consider some of this before mindlessly jumping to extremes.
Quote:
Originally Posted by Crowley
In addition, and to relate this more to Apple's products, government is responsible for the internet through DARPA, and the web, through CERN. Government regulates the cellular spectrum so that Apple can sell just a small number of variants that will work almost worldwide. Government funding of Bletchley Park led to the computing breakthroughs that made the modern computing industry possible.
Government did not contribute a damn thing? Fantasy.
Quote:
Originally Posted by Droid
Except the government is responsible for building the roads that deliver Apple's products, the government also set up the system that educated many of the people who work at Apple. The government also make the laws that mean Apple can sue when Samsung infringes their IP. Apple move that IP to other countries & rent it back to decrease their tax bill, is that a reasonable way to do buisness, move assets to places tax is lower despite creating the IP in the US?
The same government pays for the courts & prison that stop people walking into Apple stores, factories & taking the products without paying.
Quote:
Originally Posted by RichL
What have the Romans ever done for us? Well, yes, apart from the roads. And the education system. Oh, and the sewage system.
And who pays for all of that? The government?
Where do they get their money? From taxpayers?
Who is the largest corporate taxpayer in the US? Apple?
So I guess Apple's billions in taxes paid for a nice chunk of all that. More than any of you guys paid to use the same things.
Comments
Quote:
Originally Posted by newbee
Actually, Apple has paid significant tax already ....6 Billion dollars, soon to be 7 Billion. All to the good old US government. They are said to have paid almost 3% of the governments collected taxes. Not too shabby.What the government wants is to be able to tax Apple on it's worldwide profits (stuff not sold in USA). What Apple has done is to create a holding company to collect after tax profits from all over the world (minus the Americas) and put it into this Irish holding company to manage their investments. The profits on their investments is taxed by the US and paid by Apple. Apple are duty bound to their shareholders to maximize profits and minimize expenses. Taxes are an expense. Apple is only doing what they should rightfully be doing.You want to blame someone, blame the government that wastes so much money and mismanages the system and just keeps the printing presses rolling to cover up their mistakes (and handing out $$ to their friends and lobbyists.) It's a broken system, folks. It needs to be overhauled, if it isn't too late, already.That's great. I don't think anyone is criticising anything about Apple's corporation tax on its profits in the USA.A
And I do blame the governments. I've said more than once that while I don't condone what Apple have set up, I think it's very clever and I don't blame them for doing it. But they have been allowed to do it via gaps in the international tax system and insufficient regulation of transfer pricing by governments. If you're going to applaud them for paying so much tax in the USA then can you not see that it is reasonable for citizens of other countries to say "hang on, why not us too?". And further to that, it is interesting to explore ideas for what needs to be done to prevent it, to Apple's detriment, without seeing such discussions as an attack on Apple itself but as an attack on aggressive tax avoidance in general.
Let's see if we can find a few things that your federal taxes pay for - that benefit companies:
The Federal government:
1. Pays a large part of the cost of educating our kids.
2. Pays a large part of the cost of roads, ports, airports, etc.
3. Pays to defend our country (which is an enormous portion of the total tax revenues). Without a Federal Government, you'd probably be speaking Russian. Or maybe Chinese.
4. Provides the backbone of a banking system which is the envy of the world
5. Provides for rules that regulate pollution, food production, and so on. WIthout the Federal government, you'd probably be sick from pollution and bad food.
6. Invests enormously in technology development. It would be nearly impossible to find any existing technologies that weren't funded, at least in part, by the Federal Government.
7. Patents and other laws which provide for IP protection - which allows companies to profit from their own innovation.
There are many more, but that's a start. Arguing that companies don't benefit from Federal expenditures is just plain absurd.
Still waiting for your evidence that Apple's transfer pricing is unfair. (and why haven't you provided this evidence to the IRS? If you bring evidence of tax evasion to the IRS, you get a share of the tax collected). And if Apple is selling the phones to Apple US at just under the retail price, how did they generate $20 B in profits and $6 B in tax liability?
Quote:
Originally Posted by charlituna
It is not a US issue that the EU laws allow them to use a country with a low tax rate
Agreed. It's an EU (and constituent) issue.
Tax havens however are a global issue, so I don't think that particular conversation needs to stop at the EU. Indeed it looks like it'll be a big topic at the G8, which probably means that nothing will happen for about a decade.
Quote:
Originally Posted by jragosta
Let's see if we can find a few things that your federal taxes pay for - that benefit companies:
The Federal government:
1. Pays a large part of the cost of educating our kids.
2. Pays a large part of the cost of roads, ports, airports, etc.
3. Pays to defend our country (which is an enormous portion of the total tax revenues). Without a Federal Government, you'd probably be speaking Russian. Or maybe Chinese.
4. Provides the backbone of a banking system which is the envy of the world
5. Provides for rules that regulate pollution, food production, and so on. WIthout the Federal government, you'd probably be sick from pollution and bad food.
6. Invests enormously in technology development. It would be nearly impossible to find any existing technologies that weren't funded, at least in part, by the Federal Government.
7. Patents and other laws which provide for IP protection - which allows companies to profit from their own innovation.
There are many more, but that's a start. Arguing that companies don't benefit from Federal expenditures is just plain absurd.
Most of that could (and should) be done privately. Only defense (actual defense) and perhaps some pollution stuff arguably must be done through the government. IP protection is government granted monopoly and, arguably, isn't necessary either.
The argument is not "plain absurd."
Quote:
Originally Posted by jragosta
Still waiting for your evidence that Apple's transfer pricing is unfair.
I'm really not sure how I can providence any evidence better than them paying less than 1% corporation rate on the fortune in the Irish subsidiaries, and a similar effective tax rate throughout the whole of Europe. It's clear avoidance.
If you don't think that's unfair, well that's your call. I do. It deprives governments of revenue, creates unfair advantage over competitors, and rewards duplicitous practices.
Quote:
Originally Posted by jragosta
(and why haven't you provided this evidence to the IRS? If you bring evidence of tax evasion to the IRS, you get a share of the tax collected)
There is no suggestion of tax evasion. No one has alleged that Apple has done anything illegal. Besides which, I'm not even sure how I'd do that even if I did have the inclination; I'm not a US citizen.
Quote:
Originally Posted by jragosta
And if Apple is selling the phones to Apple US at just under the retail price, how did they generate $20 B in profits and $6 B in tax liability?
Apple aren't selling the phones to Apple US at just under the retail price. Not sure what you got that from, but it's not from me, I've never said that.
Quote:
Originally Posted by MJ1970
Except I didn't claim I don't have significant facts to draw upon. Perhaps not about the Roman empire specifically, yes. But there are plenty of examples besides them. Plus, you know, logical deduction.
At best, you've engaged in logical inference, not deduction, and an argument by analogy is as weak as the similarities between the situations. Since you've admitted you don't know enough about the Roman Republic or Empire, "to make a particular claim," one would expect that you wouldn't, rather than assert a flight of fancy and wishful thinking as "reasonable". How could it possibly be reasonable if you don't have sufficient knowledge to determine if it's reasonable? Even if you were correct, it would be nothing more than a lucky guess.
As Apple pointed out in the hearing, they set up the Irish division back in 1980, and what did not say is why. They did this at the time due to the fact the EU was hitting any product not produced in the EU with a 40% tariff. Apple choose Ireland because the had the unique tax incentive and the fact their unemployment was over 25% at time. Ireland was doing whatever they could to draw manufacturing company to Ireland so Apple jump on the deal. No one in our government was screaming at the EU for their 40% tariff for product made outside the US.
Apple had its factory there for a long time, even in the 90's when apple was downsizing and was about to layoff 50% of the workforce at the factory. The PM of Ireland came to Cupertino to visit the then CEO and explain to him what would happen to Apple business in the EU if they continue to layoff worker in Ireland. Needless to say those workers still had jobs, but apple completely shut down the Fremont CA factory, Again no one in our Government both US or CA said a word.
Here we are 2013 Apple is still operating the Ireland division, no longer as factory, so they must have stuck another deal with Ireland to shut that down, but according to Cook own testimony they employ 3000 people in Ireland to manage the EU business for them. Various people in the Senate panel keep saying or inferring that the Irish Division was a shell company and no one work there, they kept saying it even after Cooks comment they had 3000 people there. In typical government fashion ignore the facts when they do not back out your conclusions.
I have to say the Apple team handle themselves well and the Senator for the most part look like idiots
Quote:
Originally Posted by MJ1970
Most of that could (and should) be done privately. ...
Quote:
Originally Posted by anonymouse
Quote:
Originally Posted by jragosta
Since you admit that you don't know how the system works, why are you blathering about it at all?
And who is to say what a 'reasonable adjustment' is? Obviously, not someone who admits that he doesn't know how the system works.
The issue is far more complicated than you are implying. You are apparently unable to distinguish between income and assets.
I don't know every detail of the US tax system. From what I hear I doubt anyone does. That I admit that i don't know everything is a pretty poor reason to bash down any argument.
Thanks for graciously answering my question btw. Do you know the answer?
Quote:
Originally Posted by jragosta
Apple pays income tax where the income is earned - which is in compliance with tax laws around the world. If the effective tax rate in Ireland is 2% (or 0.0002%, for that matter), then no one outside of Ireland should have any say in the matter. Each country sets its own tax rates and it's not up to you to criticize them. If they don't want to charge ANY corporate income tax, that's their choice. (By the same token, why aren't you running around protesting that the states that don't charge sales tax are unfair?)
That would be fine if Apple's economic activity was indisputably in Ireland. The two subsidiaries AOI and ASI that book income for Apple in Ireland have no employees, and exist merely as logical facades to siphon off the illusion of where profits are made, precisely so that Apply can achieve a low tax rate. That's a misrepresentation of income, so it is very appropriate for other countries to question this arrangement. Ireland can set it's tax rate wherever it wants, but companies should not be allowed to pretend that things are happening in Ireland just to take advantage of that rate. That's almost the dictionary definition what they call "a loophole".
Also, while Ireland can set its tax laws however it wants, that doesn't mean it gets criticism immunity, and its bizarre rule about only charging corporation tax if the company is "controlled" from domestic territory is frankly bizarre, and clearly Apple has exploited that too.
I think states that don't charge sales tax are fine. Sales tax is a flat tax (or regressive, by some definitions as discussed in another thread). I prefer progressive ones.
Quote:
Originally Posted by jragosta
The issue here is what to do about bringing cash into the US which has been earned elsewhere.
Actually I don't think this thread has much to do with repatriation at all, I think it's to do with core problems with Ireland and the EU's tax regime. Maybe we've been talking at cross-purposes, which is why you seem to have misunderstood some of what I've said?
Quote:
Originally Posted by jragosta
The issue here is what to do about bringing cash into the US which has been earned elsewhere. It's essentially the same as if you buy a truck overseas and ship it here - it's an asset that is being transferred. In some states, you are required to pay sales tax in a situation like that, but not very many. If it's your truck and you bring it here, it remains your truck and you don't have to pay for it again. Similarly, the argument is that if Apple moves an asset (cash) from one place to another, it shouldn't be taxed since they've already paid tax where the asset was earned. Paying income tax again is double taxation. This is, of course, complicated by corporate structures where Apple may also be moving the asset from one entity to another - which can sometimes create tax liabilities. Either way, the argument that income earned in a different country should be taxed at the same rate as income earned in the US is suspect from the start.
There are certainly discussions that can be had, but the subsidiaries in Ireland have been set up in a deliberate way so that they don't owe corporation tax to any country. Apple is effectively channeling profits out of the taxation system. The threat of double taxation is being used as a weapon to allow zero taxation. I'm of the opinion that something should be done about that, whether it's in Ireland, the EU or the US.
So you have no evidence that Apple has done anything wrong. They pay the taxes that are required by law. Where is teh tax evasion that you keep claiming?
The government sets the tax rates. Apple pays the required taxes. How is it unfair or how are they depriving the government of revenues? The only way your argument makes sense is if all the money belongs to the government in the first place and they simply allow Apple to keep some. That's not the way it works.
So you're not a US citizen, you have no idea how the tax laws work, and you are fond of making things up (such as your claims on transfer pricing). So why should anyone believe a word you say?
No? It must have been the other Crowley in post #41 of this thread:
http://forums.appleinsider.com/t/157633/apple-publishes-execs-opening-statements-from-us-senate-testimony/40
"Apple Operations International (Ireland) buys iPhones from Apple, or Foxconn in China at cost. Apple Operations International then sells those iPhones to Apple UK, Apple Germany, Apple France etc for close to the retail price."
Quote:
Originally Posted by Crowley
I'm really not sure how I can providence any evidence better than them paying less than 1% corporation rate on the fortune in the Irish subsidiaries, and a similar effective tax rate throughout the whole of Europe. It's clear avoidance.
It is avoidance. However do you think the Irish Government should get 12.5% of Apples ongoing worldwide profits - which may exceed 70% of all profits eventually? Cork isn't a shell company, and has some IP, and some devs - but Cupertino contributes 90%+ of IP. If you are concerned about the US, then the fact that Apple has low payments outside the US means more money can be repatriated. The formula is X-Y where X is the US corporation taxes and Y is taxes already paid worldwide. Who is losing out?
Quote:
If you don't think that's unfair, well that's your call. I do. It deprives governments of revenue, creates unfair advantage over competitors, and rewards duplicitous practices.
Which Government?
Personally I think that the money should go to where the IP is created but not at the same level as the (absurd) corporation tax which the US applies.
Quote:
Originally Posted by jragosta
So you have no evidence that Apple has done anything wrong. They pay the taxes that are required by law. Where is teh tax evasion that you keep claiming?
I have never, once, ever, claimed Apple engages in tax evasion. Tax evasion is illegal. I have repeatedly stated that Apple is acting within the law. Please read what I'm writing and stop inserting your own words to set up a straw man.
Quote:
Originally Posted by jragosta
The government sets the tax rates. Apple pays the required taxes. How is it unfair or how are they depriving the government of revenues? The only way your argument makes sense is if all the money belongs to the government in the first place and they simply allow Apple to keep some. That's not the way it works.
I am not saying that Apple are acting unfairly. I have said that they are smart and acting legally, and it is the regulatory situation that is flawed. Please read what I'm writing and stop inserting your own words to set up a straw man.
Quote:
Originally Posted by jragosta
So you're not a US citizen, you have no idea how the tax laws work, and you are fond of making things up (such as your claims on transfer pricing). So why should anyone believe a word you say?
The only part of that which is true is that I'm not a US citizen. I am posting in a thread that is about Ireland and the EU, so I find it passingly relevant. Please read what I'm writing and stop inserting your own words to set up a straw man.
Quote:
Originally Posted by jragosta
No? It must have been the other Crowley in post #41 of this thread:
http://forums.appleinsider.com/t/157633/apple-publishes-execs-opening-statements-from-us-senate-testimony/40
"Apple Operations International (Ireland) buys iPhones from Apple, or Foxconn in China at cost. Apple Operations International then sells those iPhones to Apple UK, Apple Germany, Apple France etc for close to the retail price."
See that list there. See where Apple US is? I can't, the only listed entities are European and Chinese (Taiwanese specifically). Please read what I'm writing and stop inserting your own words to set up a straw man.
There's no country in the world that does that. In general, income is taxed where it is earned. That is not always the same as where the IP is created.
Quote:
Originally Posted by MJ1970
Most of that could (and should) be done privately. Only defense (actual defense) and perhaps some pollution stuff arguably must be done through the government. IP protection is government granted monopoly and, arguably, isn't necessary either.
The argument is not "plain absurd."
I am curious as to how you see the world run 'privately'. Who would pay for infrastructure and how would the cost be distributed and on what basis. I suspect that taxation will quickly look like a simpler and more equitable way of providing essential services.
Quote:
Originally Posted by paxman
Who would pay for infrastructure and how would the cost be distributed and on what basis.
Investors and customers of "infrastructure" companies.
Quote:
Originally Posted by paxman
I suspect that taxation will quickly look like a simpler and more equitable way of providing essential services.
Possibly. However this is neither a clear nor a forgone conclusion to the point of claiming that suggesting it is "plainly absurd."
Quote:
Originally Posted by Crowley
Quote:
Originally Posted by Tallest Skil
Again with your made up crap! Double tax implies being taxed twice. That's the definition of the word "double". That you can't wrap your head around the concept that you get to decide neither what is "significant" nor what is an acceptable amount of times to tax someone is YOUR problem.
In genuine answer to your bluster. Double taxation when used in the context of moral hazard implies that there's a danger that companies will be unduly punished. For them to be unduly punished they must have paid a significant amount of tax in the first place, for any "double" taxation to pose any real impediment.
Of course I understand the technical logical meaning of double taxation. But let's take a look at the real world here. Double taxation clearly isn't something that threatens to wipe out Apple's profits with two high waves of government profit seizure. How can I say that? Because their effective tax rate in Ireland is less than 1%.
Now seriously, calm down.
Crowly, Again; Seriously!
You have to stop speaking rationally with these spitting, stomping, little Tasmaian Devils (WB ©). It will get you nowhere.
Quote:
Originally Posted by massconn72
But we don't have good roads, good schools or decent public safety net systems in place, so what good are our taxes? There is nobody in this country that can say our monies are being put to not only good use or even proper use.
So how do the countries who do have good roads, good education, good transportation, do it?
Quote:
Originally Posted by jragosta
Let's see if we can find a few things that your federal taxes pay for - that benefit companies:
The Federal government:
1. Pays a large part of the cost of educating our kids.
2. Pays a large part of the cost of roads, ports, airports, etc.
3. Pays to defend our country (which is an enormous portion of the total tax revenues). Without a Federal Government, you'd probably be speaking Russian. Or maybe Chinese.
4. Provides the backbone of a banking system which is the envy of the world
5. Provides for rules that regulate pollution, food production, and so on. WIthout the Federal government, you'd probably be sick from pollution and bad food.
6. Invests enormously in technology development. It would be nearly impossible to find any existing technologies that weren't funded, at least in part, by the Federal Government.
7. Patents and other laws which provide for IP protection - which allows companies to profit from their own innovation.
There are many more, but that's a start. Arguing that companies don't benefit from Federal expenditures is just plain absurd.
Quote:
Originally Posted by hmm
You're parroting the same thing, yet you ignore the fact that these companies depend on the court system, banking system, military, and diplomatic work. Perhaps you should consider some of this before mindlessly jumping to extremes.
Quote:
Originally Posted by Crowley
In addition, and to relate this more to Apple's products, government is responsible for the internet through DARPA, and the web, through CERN. Government regulates the cellular spectrum so that Apple can sell just a small number of variants that will work almost worldwide. Government funding of Bletchley Park led to the computing breakthroughs that made the modern computing industry possible.
Government did not contribute a damn thing? Fantasy.
Quote:
Originally Posted by Droid
Except the government is responsible for building the roads that deliver Apple's products, the government also set up the system that educated many of the people who work at Apple. The government also make the laws that mean Apple can sue when Samsung infringes their IP. Apple move that IP to other countries & rent it back to decrease their tax bill, is that a reasonable way to do buisness, move assets to places tax is lower despite creating the IP in the US?
The same government pays for the courts & prison that stop people walking into Apple stores, factories & taking the products without paying.
Quote:
Originally Posted by RichL
What have the Romans ever done for us? Well, yes, apart from the roads. And the education system. Oh, and the sewage system.
And who pays for all of that? The government?
Where do they get their money? From taxpayers?
Who is the largest corporate taxpayer in the US? Apple?
So I guess Apple's billions in taxes paid for a nice chunk of all that. More than any of you guys paid to use the same things.