We allowed money to drive our elections, so that only those with corporate support got elected, and they in turn created tax laws that favored their corporate sponsors. Only now are we starting to awaken to the result: tax avoidance by the multinationals, supra-taxation on the lower-income masses. The best course of correction is not to blame individual companies complying with the law, but rather to revise political finance law so that politicians can be freed of control by the corporate elite, and then levy fair, sensible, pro-economy tax policies.
Perhaps they should have gone to Ireland instead? Meanwhile we have quite a few States in the US that offer special incentives to business. It seems to be a pretty normal state of affairs (no pun intended). Why should Ireland 'get in line' if it suits them not to and is legal? Isn't that called a free market?
The problem here is really that there are no easy and clean-cut answers to any of this. And making that a pro or contra tax discussion won't solve it either.
Ireland tried a lot to attract businesses since the 1990s, and they had to. A lot of companies got highly favourable deals (Apple, MS, Gateway etc.). But in the end, it did not really work for them. Irish banks are in trouble, there's a real estate bubble etc. As a result the richer countries in the EU are supporting Ireland, while Ireland is extracting taxes from those countries, and in the end nobody in the EU including Ireland benefits from it. Goods are expensive, personal and federal debts are rising and all that dead money from Apple and others hangs in low interest investments that do not even create business...
Blaming Ireland does not help, it is even hypocritical. Every single EU country tries to be a tax haven for somebody else, and all countries deliberately leave some loopholes to attract investments. And everybody cries foul and is miffed, when others do the same.
The EU has to decide how they want it to be. The current laws are pretty clear. You can register a business in any member state. Current VAT rates in the EU range from 2.1% to 27% (depending on the country and category of goods) and corporate taxes sit between 1.6% and 40% (depending on the country, sometimes even the city, and the size of a business). You can call that a "harmonised economic area" until the cows come home... but nobody should really act surprised when companies try to use this to their benefit. Calling out big names like Apple is stinking populism. The truth is that absolutely nobody wants to close any of these tax holes, but explaining that to a population that pays 35% in taxes and mandatory health care, nursing and pension funds on $1000 income... would require guts.
Of course the conservatives (and I'm not a liberal) are the same ones saying our debt is destroying us while they champion huge billion dollar companies paying zero taxes. And all while saying we need even more trillions for their military contractor buddies. Who do these morons think pays if billion dollar companies don't?
I personally will take every legal deduction, use every legal loophole, delay payment as long as possible, to avoid paying one red cent more than I absolutely have to. If I could find a way to pay no taxes at all I would jump on it. If that makes me a sociopath then so be it. I'm proud to be on your evil list.
This debate is the classic battle between individualism and the hive mentality. The individualists cross over the mountain top and find new land. Then the hive shows up with its "community" mindset and screws it all up.
That attitude will ensure we drive on no public highways, drink no public water, breathe no clean air, have no public sanitation, have no vaccine development against contagious disease, have an unreliable food supply and are subject to famine, have no quality and efficacy standards in foods & drugs, have no health inspections of restaurants, and that our children are kept uneducated and ingnorant. And much, much more.
ps: It'll also ensure you have no defense department, police force, or national guard to prevent OTHER individualists from crossing the mountain top and seizing your backyard, as your predecessors seized it from the previous occupants.
I think you're mistaking "fully approved by the government" with "complex accounting practices that the government is actively trying to shut down".
And just because it's legal doesn't mean that it's right. Paying no tax is sociopathic behaviour. If everyone did the same, society would collapse. And the more tax that the world's most profitable company doesn't pay, the more the rest of us pay.
Google, Amazon, Starbucks et al are no better.
I didn't mistake anything at all. If the government is trying to shut that down, good. Until then, it is not illegal. What is so difficult about that? Who cares if it's an individual or corporation. Anything one can do to LEGALLY reduce their taxes and pay only what they are absolutely required to pay is called prudent planning.
And don't even get on your soapbox and preach taxes and morality. Reducing one's tax liability (legally) is the right thing to do. Any argument to the contrary and you lost the debate. Whether it is right to pay minimal taxes or a lower-rate than joe-consumer certainly is irrelevant. Change the damn tax laws that were passed by the politicians. Don't hammer companies or people for not doing anything legally wrong.
If society collapses because everyone is doing it, sounds like its stupidity on the government's side for not getting their act together. Will never happen, and it's ludicrous to play the "what if" scenario.
Where does it say UK investigators went into Apple HQ? I think you might have this confused with the French raid article. This info is all from Apple's filings.
And no, its not picking on Apple. Far from it. It seems all countries are having the same issue at the moment, the companies are however complying with the law. All I'm saying is that there needs to be a global agreement on this otherwise the richest companies in the world will continue to pay almost zero tax on their profits (which, again, I'm no criticising them for as it is their duty to maximise their value).
My bad, yes I was mixing the two incidents up as i was replying to both.
Thank goodness someone has a grip on reality in this discussion. Describing taxation as theft is simply moronic, misappropriation of collected tax revenue by the government on the other hand could be described as theft.
Apple present themselves as a morally forthright company and as such should be paying corporation tax in each and every country in which they operate at a profit. Every business has to pay tax on it's profits and being a multinational corporation does not excuse you from doing so. Why should small to medium sized business owners and operators have to pay a larger proportion of taxes to offset what these large multinationals do not. Under the current tax system what these large companies do (i realise Apple are not a lone in this practise but this is an apple centric website) may not be legally wrong but it is most certainly morally wrong. Governments exist to serve and protect the interests of it's nations citizens and this is becoming increasingly hard to do when cash rich corporations wield such huge amounts of influence and power. Big business already dictates the formation ofgovernmental policy in a multitude of key areas here in the UK including, health, defence and educational curriculum, if you can't see the danger in this then you are either blind, apathetic, incredibly stupid or a minion of a corporate paymaster.
[quote name="irrational-gas" url="/t/158323/apple-faces-scrutiny-again-after-paying-no-2012-corporate-taxes-in-uk/40#post_2355844"]Apple present themselves as a morally forthright company and as such should be paying corporation tax in each and every country in which they operate at a profit. [/QUOTE]
Nope. They should be paying tax in every country in which they legally must pay tax.
[QUOTE]Every business has to pay tax on it's profits and being a multinational corporation does not excuse you from doing so.[/QUOTE]
Why preemptively attack people who have different political beliefs? Don't you care how this reflects on your character ?
People complaining that Apple should pay more taxes because it's "the right thing to do", above and beyond their legal obligation are simply whining, or trolling. Pick one. That's the only two choices.
Don't like the tax system, change it. Until then, Apple (and me) will continue to search for every possible, legal method to reduce our tax burden. Period.
People complaining that Apple should pay more taxes because it's "the right thing to do", above and beyond their legal obligation are simply whining, or trolling. Pick one. That's the only two choices.
And, as has been stated frequently elsewhere, a company paying taxes where none are legally required is IMMORAL for having stolen that money from shareholders and given it to a political government elsewhere.
I own a business park. Several years ago (2007-2008), we put a lot of money into one segment that - frankly - had a disastrous financial outcome. The losses from our business carried back (via our LLC) into our personal taxes, and when the dust all settled, we owed Uncle Sam zero taxes for that year.
I mention this because it is always easy to get off a cheap shot about so-and-so not paying any taxes. The way the tax code now stands - and I'm assuming it got there pretty much via both political parties - is that it's not just collecting revenue but providing incentives (and disincentives). Buy a Nissan Leaf and get a big tax credit. Take a withdrawal from your IRA before turning 59 1/2 and pay a 10% penalty. Donate old clothing to a charity and get a deduction. Replace an old fridge with a new one in your restaurant, and expense (depreciate) it all in one year using Section 179. And so on, and so forth.
If people don't like the fact that Apple didn't pay any UK income tax - and accountants / auditors confirm that they followed all tax laws and didn't do anything illegal - then they need to take it up with the people who write the laws, not with those who follow them.
"The California based company's European operations pulled in $36.3 billion in net sales to European customers in 2012. Of that, Apple reported that $15 billion was operating profit."
By any standards, that is an obscene profit margin.
The issue is the Irish tax setup. The Irish government says corporations incorporated in Ireland pay tax on where they're managed and controlled from (for Apple, this is the U.S.) but US rules (and most other major economies) say the tax should be paid where the company is incorporated. If Ireland got in line with everyone else, a lot of this would go away.
No, this is a European rule, not Irish. Infact you will find there are a number of English companies that are incorporated in England, and pay no foreign taxes, B Sky B is one, they operate in Ireland and pay no corporate taxes
[QUOTE name="jfanning" url="/t/158323/apple-faces-scrutiny-again-after-paying-no-2012-corporate-taxes-in-uk/40#post_2355919"] No, this is a European rule, not Irish. Infact you will find there are a number of English companies that are incorporated in England, and pay no foreign taxes, B Sky B is one, they operate in Ireland and pay no corporate taxes[/QUOTE] You are correct in that UK companies use Ireland's low tax rate to minimise their tax bill. However, Apple go one step further, as detailed [URL=http://www.forbes.com/sites/leesheppard/2013/05/28/how-does-apple-avoid-taxes/]here[/URL]. Basically Apple have a subsidiary that all of their non-US sales are routed through that is incorporated in Ireland, managed and controlled in the U.S. but not tax resident in any country.
Again, nothing wrong with that legally and I would expect Apple to do that as the rules currently allow it. If governments aren't happy with it they need to get together and come up with a global agreement.
I think you'll find that is exactly the argument and I direct your attention to the opening dialogue of the article:
" Apple may once again come under the spotlight over taxes, as the iPhone maker's latest filings reveal that it paid no corporate taxes in the United Kingdom last year."
I am aware that it's not Apple's fault there is a tax loophole but the fact remains they and other large multinationals are guilty of exploiting it and there is a world of difference between an individual getting creative with his/her tax return and paying no tax at all which is essentially what Apple are doing here in the UK. Furthermore by not paying corporation taxes on their profit margins it means that these multinationals are effectively preying on our economy, they generate no tax income and very little of their profits are reinvested in the UK, and certainly not anywhere near enough to provide adequate compensation for the tax relief they receive.
This may not be illegal but it is unethical. The UK has a welfare system and a fantastic National Health Service (all medical care free at source). As a British national I would prefer Apple to respect our welfare system and the cost of running it. You may not have such luxuries in the USA but the majority of our country is proud of our ability to help everyone regardless of wealth or income.
Comments
"You reap what you sow."
We allowed money to drive our elections, so that only those with corporate support got elected, and they in turn created tax laws that favored their corporate sponsors. Only now are we starting to awaken to the result: tax avoidance by the multinationals, supra-taxation on the lower-income masses. The best course of correction is not to blame individual companies complying with the law, but rather to revise political finance law so that politicians can be freed of control by the corporate elite, and then levy fair, sensible, pro-economy tax policies.
The problem here is really that there are no easy and clean-cut answers to any of this. And making that a pro or contra tax discussion won't solve it either.
Ireland tried a lot to attract businesses since the 1990s, and they had to. A lot of companies got highly favourable deals (Apple, MS, Gateway etc.). But in the end, it did not really work for them. Irish banks are in trouble, there's a real estate bubble etc. As a result the richer countries in the EU are supporting Ireland, while Ireland is extracting taxes from those countries, and in the end nobody in the EU including Ireland benefits from it. Goods are expensive, personal and federal debts are rising and all that dead money from Apple and others hangs in low interest investments that do not even create business...
Blaming Ireland does not help, it is even hypocritical. Every single EU country tries to be a tax haven for somebody else, and all countries deliberately leave some loopholes to attract investments. And everybody cries foul and is miffed, when others do the same.
The EU has to decide how they want it to be. The current laws are pretty clear. You can register a business in any member state. Current VAT rates in the EU range from 2.1% to 27% (depending on the country and category of goods) and corporate taxes sit between 1.6% and 40% (depending on the country, sometimes even the city, and the size of a business). You can call that a "harmonised economic area" until the cows come home... but nobody should really act surprised when companies try to use this to their benefit. Calling out big names like Apple is stinking populism. The truth is that absolutely nobody wants to close any of these tax holes, but explaining that to a population that pays 35% in taxes and mandatory health care, nursing and pension funds on $1000 income... would require guts.
Quote:
Originally Posted by lkrupp
I personally will take every legal deduction, use every legal loophole, delay payment as long as possible, to avoid paying one red cent more than I absolutely have to. If I could find a way to pay no taxes at all I would jump on it. If that makes me a sociopath then so be it. I'm proud to be on your evil list.
This debate is the classic battle between individualism and the hive mentality. The individualists cross over the mountain top and find new land. Then the hive shows up with its "community" mindset and screws it all up.
That attitude will ensure we drive on no public highways, drink no public water, breathe no clean air, have no public sanitation, have no vaccine development against contagious disease, have an unreliable food supply and are subject to famine, have no quality and efficacy standards in foods & drugs, have no health inspections of restaurants, and that our children are kept uneducated and ingnorant. And much, much more.
ps: It'll also ensure you have no defense department, police force, or national guard to prevent OTHER individualists from crossing the mountain top and seizing your backyard, as your predecessors seized it from the previous occupants.
Quote:
Originally Posted by RichL
I think you're mistaking "fully approved by the government" with "complex accounting practices that the government is actively trying to shut down".
And just because it's legal doesn't mean that it's right. Paying no tax is sociopathic behaviour. If everyone did the same, society would collapse. And the more tax that the world's most profitable company doesn't pay, the more the rest of us pay.
Google, Amazon, Starbucks et al are no better.
I didn't mistake anything at all. If the government is trying to shut that down, good. Until then, it is not illegal. What is so difficult about that? Who cares if it's an individual or corporation. Anything one can do to LEGALLY reduce their taxes and pay only what they are absolutely required to pay is called prudent planning.
And don't even get on your soapbox and preach taxes and morality. Reducing one's tax liability (legally) is the right thing to do. Any argument to the contrary and you lost the debate. Whether it is right to pay minimal taxes or a lower-rate than joe-consumer certainly is irrelevant. Change the damn tax laws that were passed by the politicians. Don't hammer companies or people for not doing anything legally wrong.
If society collapses because everyone is doing it, sounds like its stupidity on the government's side for not getting their act together. Will never happen, and it's ludicrous to play the "what if" scenario.
My bad, yes I was mixing the two incidents up as i was replying to both.
Thank goodness someone has a grip on reality in this discussion. Describing taxation as theft is simply moronic, misappropriation of collected tax revenue by the government on the other hand could be described as theft.
Apple present themselves as a morally forthright company and as such should be paying corporation tax in each and every country in which they operate at a profit. Every business has to pay tax on it's profits and being a multinational corporation does not excuse you from doing so. Why should small to medium sized business owners and operators have to pay a larger proportion of taxes to offset what these large multinationals do not. Under the current tax system what these large companies do (i realise Apple are not a lone in this practise but this is an apple centric website) may not be legally wrong but it is most certainly morally wrong. Governments exist to serve and protect the interests of it's nations citizens and this is becoming increasingly hard to do when cash rich corporations wield such huge amounts of influence and power. Big business already dictates the formation ofgovernmental policy in a multitude of key areas here in the UK including, health, defence and educational curriculum, if you can't see the danger in this then you are either blind, apathetic, incredibly stupid or a minion of a corporate paymaster.
Nope. They should be paying tax in every country in which they legally must pay tax.
[QUOTE]Every business has to pay tax on it's profits and being a multinational corporation does not excuse you from doing so.[/QUOTE]
That's not the argument. Try again.
Quote:
Originally Posted by ankleskater
Why preemptively attack people who have different political beliefs? Don't you care how this reflects on your character ?
People complaining that Apple should pay more taxes because it's "the right thing to do", above and beyond their legal obligation are simply whining, or trolling. Pick one. That's the only two choices.
Don't like the tax system, change it. Until then, Apple (and me) will continue to search for every possible, legal method to reduce our tax burden. Period.
Quote:
Originally Posted by sflocal
People complaining that Apple should pay more taxes because it's "the right thing to do", above and beyond their legal obligation are simply whining, or trolling. Pick one. That's the only two choices.
And, as has been stated frequently elsewhere, a company paying taxes where none are legally required is IMMORAL for having stolen that money from shareholders and given it to a political government elsewhere.
I mention this because it is always easy to get off a cheap shot about so-and-so not paying any taxes. The way the tax code now stands - and I'm assuming it got there pretty much via both political parties - is that it's not just collecting revenue but providing incentives (and disincentives). Buy a Nissan Leaf and get a big tax credit. Take a withdrawal from your IRA before turning 59 1/2 and pay a 10% penalty. Donate old clothing to a charity and get a deduction. Replace an old fridge with a new one in your restaurant, and expense (depreciate) it all in one year using Section 179. And so on, and so forth.
If people don't like the fact that Apple didn't pay any UK income tax - and accountants / auditors confirm that they followed all tax laws and didn't do anything illegal - then they need to take it up with the people who write the laws, not with those who follow them.
The best Apple can do is make a very fast buck whilst trade channels are still open.
By any standards, that is an obscene profit margin.
No, this is a European rule, not Irish. Infact you will find there are a number of English companies that are incorporated in England, and pay no foreign taxes, B Sky B is one, they operate in Ireland and pay no corporate taxes
Why? Not Ireland's issue
No, this is a European rule, not Irish. Infact you will find there are a number of English companies that are incorporated in England, and pay no foreign taxes, B Sky B is one, they operate in Ireland and pay no corporate taxes[/QUOTE]
You are correct in that UK companies use Ireland's low tax rate to minimise their tax bill. However, Apple go one step further, as detailed [URL=http://www.forbes.com/sites/leesheppard/2013/05/28/how-does-apple-avoid-taxes/]here[/URL]. Basically Apple have a subsidiary that all of their non-US sales are routed through that is incorporated in Ireland, managed and controlled in the U.S. but not tax resident in any country.
Again, nothing wrong with that legally and I would expect Apple to do that as the rules currently allow it. If governments aren't happy with it they need to get together and come up with a global agreement.
Quote:
Originally Posted by aBeliefSystem
1930's protectionism is about to happen. The best Apple can do is make a very fast buck whilst trade channels are still open.
There's always a funny one in the crowd.
I think you'll find that is exactly the argument and I direct your attention to the opening dialogue of the article:
" Apple may once again come under the spotlight over taxes, as the iPhone maker's latest filings reveal that it paid no corporate taxes in the United Kingdom last year."
I am aware that it's not Apple's fault there is a tax loophole but the fact remains they and other large multinationals are guilty of exploiting it and there is a world of difference between an individual getting creative with his/her tax return and paying no tax at all which is essentially what Apple are doing here in the UK. Furthermore by not paying corporation taxes on their profit margins it means that these multinationals are effectively preying on our economy, they generate no tax income and very little of their profits are reinvested in the UK, and certainly not anywhere near enough to provide adequate compensation for the tax relief they receive.