Apple has the best lawyers and the best accountants of any multinational corporation on the face of the Earth. I'm sure everything Apple did was 100% legal.
Suck it, Australia!
You miss the real point here, the tax roundabout doesnt just affect Australia, its the USA who misses out on the tax as well. If you follow the path, its to Ireland, Holland, then the Caymans/Bahama, none of which makes it to the US.
But is Apple doing anything different than, Google, Samsung, Msoft etc Probably not.
By hey you still have the IRS who will nail YOU if you tried something like this....
hmm wrote: »
Corporations all do that. It may be problematic and grant the largest businesses an unfair advantage, but it needs to be dealt with via updated laws. As Frood pointed out, Apple just happens to be big enough to attract attention. I would add that Apple clamors for press attention, so it happens to include negative attention when they engage in something that should be admonished.
benjamin frost wrote: »
asdasd wrote: »
So you think that companies pay tax on revenues, not profits and pay that tax on profit in every country they sell to? Just to be clear because "no" isn't much of an answer.
That isn't something I can answer, but your most obvious alternative would involve a drastic shift in business culture. I don't see that happening anytime soon. The negative PR may cost them something, but not enough that it dissuades such practices.
Taxes paid in other countries are credited against US taxes in almost all cases (may be exceptions), as long as the company applied for refunds of overpaid taxes where applicable. That is at least in the US. This is different from operating costs where they aren't taxed on an amount equivalent to the accrual of certain costs, including depreciation of certain things. If you look at the nature of the criticism, it is sometimes warranted. I can't comment on every situation. Look up Starbucks though. They used disingenuous transfer pricing to make subsidiaries appear to be operating at a loss. If this was really the case, they would have closed stores or changed their strategy in the UK.
To your credit, Marvin you are very polite.
Oh I didn't notice that. I'll re-read the article again later. I'm aware of the issue of physical residence. There are countries where a given company may not own their distribution channels. It could just be Company A --> third party resident company within that country --> retailers. I'm not actually sure how they're set up in Australia. My main point there was to mention that they could claim a credit against taxes paid there, so they would not actually pay that amount a second time on repatriated funds.
Again that is interesting, but it means I really need to re-read the attached material. I mentioned Starbucks for their abuse of loose regulation on transfer pricing. They own both subsidiaries. One resides in a lower tax country. They charge themselves at a level that would be unsustainable if the money was owed to another company. That's why I find it disingenuous and used that as an example of deserved negative PR.
If this continues every country in the world is going to claim corporation tax from every company in the world
It's complicated with big companies. I think most of them regard themselves as essentially sovereign and merely parked in one country or another.
I don't have access to the AFRs analysis or to the records Apple provided ATO.
It is certainly undeniable that Apple has been create in its tax accounting. It uses the "double-Irish-Dutch" scheme and some have said that it invented it. That, however, is beside the point.
A crucial point - almost always overlooked in sensational media releases such as these, is that thirty years ago Apple took a bold step in its development strategy. One that has paid off in this instance. That step was to allocate expenses for development of its intellectual property (the most valuable asset) between the U.S. [maybe North America] and the rest of the world. Each division was charged a portion of the cost in proportion to the share of sales. This started in about 1980 or 1981 - I'm not sure of the exact year but it certainly was before the introduction of Macintosh which was 1984. So "Apple US" paid its share for devices sold in the US [or North America] and "Apple Ireland" paid its share for devices sold in the rest of the world.
So the point is that we don't know - and AFR is probably not interested in finding out - whether or not this profit is just a reasonable return - to Apple Ireland - on the years of development expenditure it has incurred.
I acknowledge the point that Apple has been creative in structuring its corporate organization to minimize its taxes. There's no fault in that. If the Government wants to change it then let it change. Until then it is what it is.
If AFR wants to assert that Apple has acted illegally with use of "transfer pricing" etc. then it should make that claim and let it play out in court. I'll wager that it [AFR] will never do so because it would expose its somewhat shoddy investigative and reporting practices.
Game on, AFR !
No. BUT - Apple Ireland has been paying its share of R&D costs (mostly in California) since 1980. As such, Apple Ireland does have a valid claim to the revenues produced by that investment.
As it is right now, Apple Ireland contributes more to Apple's R&D expenses than Apple US, since their sales are greater.
So - Is it [OS development] done in Ireland? No.
Is it paid for from Ireland? Yes.
Next question ...
See the Australian Tax Office's recent payout of $880 million to News Corp after they lost the case.
You can read all about it in the crap Rupert Murdoch's puppet hacks present as news in his newspapers.
And then Apple would get get sued by its' shareholders for making these voluntary yet 'illegal' payments as it would be a breech of the corporation's fiduciary responsibilities to its' shareholders.
Who really cares about what shareholders think? If they don't want to own shares in a profitable company that behaves ethically in relation to paying taxes, then they can sell their Apple shares and buy shares in a company in the fossil fuel, tobacco or gambling industries which have no scruples about behaving unethically.
Actually it is, if he didn't have a heart attack he probably would never have donated the defibrillators.
As Marvin pointed out if he hadn't avoided (as opposed to evaded) taxes the ambulances may have been equipped at the governments expense, which is something our taxes should be spent on.
Good for Apple. Any company doing there job should minimize there taxes its there job to do that for the shareholders. If Australia wants more tax legislate and close the holes that allowed that money to slip through.
Shareholders also have a vote on who sits on their board of directors, they vote on shareholder proposals and other important facets of the company, in addition to owning the stock.
Saddening. Big corporations spirit profits away to phantom holding companies, while developed countries suffer from lack of government revenues and get turned to increasingly right-wing politics as a result. The neo-con destruction of the state is happening everywhere, and the burdens on the people increases every day. And they applaud.
Guess that means no Fortune 500 companies or 99.9% of other businesses (or taxpayers for that matter) then. How much in extra taxes do you think corporations should pay that would make sure they are paying their 'fair' share? As a rule companies, corporations and individuals take every deduction they can and do not pay more than that are legally obligated to pay. How many companies do you know of, have paid extra 'voluntary' taxes?
How many companies do you know of have paid extra 'voluntary' taxes?
I'm sure there are companies that could employ offshore schemes to reduce their tax burden and haven't. Hell, Tim Cook has made a point of saying that Apple pays its full allotment of US tax for its US operations, and the numbers bear that out. I bet they could shift some of that offshore if they wanted, but they don't, because of negative PR.
macaholic_1948 wrote: »
When ethics and law are at cross purposes, one must follow the law. That is good corporate governance. It is a fiduciary responsibility that must be met. It is ethical behavior. And, most importantly, it supports the rule of law. If you don't like that ethics and the law are at odds, change the law to suit your ethical purpose. If you can't do that, accept that others' views of what is ethical are at odds with yours. If that is still unsettling, either change your ethical values or work to change others'.