Apple on pace to double lobbying spending on taxes, other issues

Posted:
in General Discussion edited January 2014
Embroiled in controversy over alleged tax avoidance, Apple is jumping into the fray in Washington, as the iPad maker is reportedly on track to double the amount of money it spends lobbying politicians.

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Apple could spend $4 million lobbying politicians on the Hill, twice what the company spent last year and more than 20 times the $180,000 it spent in 1999, according to Reuters. The bump in lobbying spending comes with the iPhone maker under fire for allegedly being one of the largest tax avoiders in the nation.

Multinational U.S. corporations are currently holding about $1.5 trillion in profits offshore, hoping to somehow avoid the 35 percent corporate income tax that would accompany repatriation of the funds. About 6.7 percent of that total is held by Apple, which issued bonds to finance a stock buyback instead of paying $9.2 billion in taxes to bring the money back to America.

During his testimony on the Hill, Apple chief Cook said the company has no plans to bring its cash pile to American shores with taxes on foreign earnings as they are. It now appears the company is willing to put its muscle behind shifting corporate taxes downward.

"They are very, very tactical," an unnamed former Apple lobbyist told Reuters. "They only join issues they really care about."

Apple has yet to set up a political action fund to distribute employee contributions to sympathetic congresspersons, but the company has begun bringing in outside lobbying firms such as Fierce, Isakowitz & Blalock, as well as Capitol Tax Partners. The Glover Park Group and the Franklin Square Group have also signed on with Apple, giving the firm lobbyists with experience in taxes, broadband, electronic waste, and spectrum issues.

Cook in the course of his testimony called for the corporate tax rate to drop from its current level of 35 percent to around 25 percent. In terms of foreign earnings, the Apple chief didn't give a specific figure, but he did say that "the rate... to incent [a] huge number of companies [to repatriate their cash], would have to be a single-digit number."

Such a shift in the tax code, Cook said, would not be beneficial only for Apple. Apple, in fact, would be among the companies paying more than it currently does in taxes under such a scheme.

Aside from taxes, Apple would likely lobby Congress on environmental and import issues, as well as broadband and other technology issues. Another likely area of interest would be America's intellectual property protections. Given its struggles with Samsung and other Android device makers, Apple would like to see intellectual property protections within the United States strengthened, as it argues the system isn't built to handle the rapid pace of technological development.

"The U.S. court system is currently structured in such a way," Cook said during his testimony, "that it's currently difficult to get the protections a technology company needs."

Even should Apple double its lobbying to $4 million in 2013, its spending is nowhere near that of other tech giants. Four million would put Apple at about the level that Facebook spent last year. By comparison, Oracle spent more than 50 percent more than that, while Microsoft spent twice that amount. The largest tech lobbying spender in 2012 was Google, which spent $18.2 million lobbying Washington.
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Comments

  • Reply 1 of 38
    gazoobeegazoobee Posts: 3,754member


    This is sad.  We all know that "lobbying" is just another word for corruption, payola, payoffs, bribes, etc. 


    It's so primitive, so ... middle-ages. 


     


    You'd think we'd be beyond that kind of corruption in this day and age.  


    Oh well, born too soon I suppose. image

  • Reply 2 of 38
    tallest skiltallest skil Posts: 43,388member


    Stupid analysts.

  • Reply 3 of 38
    umrk_labumrk_lab Posts: 550member
    Great ! It was time to address this underutilzed tax deduction scheme, uh ? Thank you, Senators ...
  • Reply 4 of 38
    MacProMacPro Posts: 19,778member
    gazoobee wrote: »
    This is sad.  We all know that "lobbying" is just another word for corruption, payola, payoffs, bribes, etc. 
    It's so primitive, so ... middle-ages. 

    You'd think we'd be beyond that kind of corruption in this day and age.  
    Oh well, born too soon I suppose. :)

    If you can't beat them join them ... sad but true. I at least have some faith that Tim will try to influence our 'for sale Congress' to improve things for the benefit of America as a whole not just Apple. Apple have to out bid South Korea remember.
  • Reply 5 of 38
    charlitunacharlituna Posts: 7,217member
    For a company the size of Apple $4 mil a year is pocket change. And it will likely be used over the IP issue more than the tax one. Because despite their public statements that they are happy to pay more if the laws require it, so long as the laws are fair, no company really wants a raise in expenses.

    But better IP protection, particularly that might stop folks like Lodsys and avoid those court costs. Who wouldn't want that
  • Reply 6 of 38
    robin huberrobin huber Posts: 3,983member
    Exactly what I called for in a thread yesterday. So gratifying that Tim reads AI.
  • Reply 7 of 38
    mj1970mj1970 Posts: 9,002member

    Quote:

    Originally Posted by charlituna View Post



    For a company the size of Apple $4 mil a year is pocket change. And it will likely be used over the IP issue more than the tax one. Because despite their public statements that they are happy to pay more if the laws require it, so long as the laws are fair, no company really wants a raise in expenses.



    But better IP protection, particularly that might stop folks like Lodsys and avoid those court costs. Who wouldn't want that


     


    Some people.

  • Reply 8 of 38
    solipsismxsolipsismx Posts: 19,566member
    So now we get to find out if all these unwarranted attacks on Apple are because of their excessive mindshare or because they didn't spend enough on legal bribes in Washington.
  • Reply 9 of 38
    mstonemstone Posts: 11,510member

    Quote:

    Originally Posted by SolipsismX View Post



    So now we get to find out if all these unwarranted attacks on Apple are because of their excessive mindshare or because they didn't spend enough on legal brides in Washington.


    They should spend more money on improving auto spelling correction. Or just get rid of it.

  • Reply 10 of 38
    umrk_labumrk_lab Posts: 550member
    Does this increase reflect more than the salarial cost of the hearing (Tim Cook + his colleagues ) ?
  • Reply 11 of 38
    umrk_labumrk_lab Posts: 550member
    (double post)
  • Reply 12 of 38
    jdsonicejdsonice Posts: 156member


    Now that Apple has decided to spend on lobbying Congress the hearings should stop. 


     


    All that our lawmakers were asking was a share of all that money Apple was making. 


     


    After all they need their retirement accounts too. Why should Apple not share some of the money with


    our lawmakers. 

  • Reply 13 of 38
    bugsnwbugsnw Posts: 717member
    Ironically, lobbying is exactly what got us to where we are today with the convoluted tax code. I wouldn't have made this move.
  • Reply 14 of 38
    solipsismxsolipsismx Posts: 19,566member
    bugsnw wrote: »
    Ironically, lobbying is exactly what got us to where we are today with the convoluted tax code. I wouldn't have made this move.

    You know the old sayings..

    "If you can't beat 'em, pay them off." and "When in Rome bribe the Senate."
  • Reply 15 of 38
    crowleycrowley Posts: 10,453member


    I wonder what the pro-rata cost of sending Tim Cook, Peter Oppenheimer and the other guy to Washington for the day was?  Given their wage packets it might even approach $4m just for that one event image

  • Reply 16 of 38
    themacmanthemacman Posts: 151member
    The Senate hearing was just a sham. The real reason was to compel Apple to spend more money on lobbying. Mission accomplished.
  • Reply 17 of 38
    512ke512ke Posts: 782member
    Why pick on apple when google and every other company funnels its cash into foreign companies in exactly the same way?

    Why can't apple drive the narrative? This week's story is: apple alone cheats at taxes, apple alone uses lobbyists, and only apple won't have a new product until late 2014.

    Is this fair and accurate? Of course not. But. How can apple change this story?

    Or maybe it's impossible and no matter what the story is going to be negative for apple.

    If so..... That sucks!
  • Reply 18 of 38
    extremeskaterextremeskater Posts: 2,248member

    Quote:

    Originally Posted by SolipsismX View Post



    So now we get to find out if all these unwarranted attacks on Apple are because of their excessive mindshare or because they didn't spend enough on legal bribes in Washington.


    This is exactly what Microsoft did when they got hammered with the antitrust. In the US we have the best government money can buy.

  • Reply 19 of 38
    lkrupplkrupp Posts: 10,557member

    Quote:

    Originally Posted by Gazoobee View Post


    This is sad.  We all know that "lobbying" is just another word for corruption, payola, payoffs, bribes, etc. 


    It's so primitive, so ... middle-ages. 


     


    You'd think we'd be beyond that kind of corruption in this day and age.  


    Oh well, born too soon I suppose. image



     


    Not born too soon, just ignorant of human nature.

  • Reply 20 of 38
    palominepalomine Posts: 363member
    Robin Huber,
    I also read your suggestion yesterday. I hate it, but I think you are correct. Apple will do its best to be an enlightened corporation, but it must act to balance the narrative.
    Does anyone know how much Amazon spends on lobbying? Besos also has friends on Wall St. The p/e on their stock price is so high it is meaningless. I wonder how long they can keep their 'we are expanding to rule the world!' narrative going
    I see Apple is cultivating Goldman a little through Laurene, maybe?

    It's pitiful to watch a company like Apple get treated by Wall Street like an indentured whore slave. Trashed and thrown away over and over. Then attacked by the government for any reason. You are right, they will continue to have problems until they PAY UP.

    It is reassuring that they are finally getting ahold of this issue of influence peddling and dealing with it. It's ugly but necessary.
    Doing what the other guys are doing, very un-Apple like, but time to stop the bad influences from affecting the company's public perception.
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