Apple: It's not enough to send 750,000 jobs out of America, they also avoid paying BILLIONS in taxes

[Zalatix]

http://www.nytimes.com/2012/04/29/business/apples-tax-strategy-aims-at-low-tax-states-and-nations.html?src=me&ref=general

THE IECONOMY
How Apple Sidesteps Billions in Global Taxes

RENO, Nev. — Apple, the world’s most profitable technology company, doesn’t design iPhones here. It doesn’t run AppleCare customer service from this city. And it doesn’t manufacture MacBooks or iPads anywhere nearby.

Yet, with a handful of employees in a small office here in Reno, Apple has done something central to its corporate strategy: it has avoided millions of dollars in taxes in California and 20 other states.

Apple’s headquarters are in Cupertino, Calif. By putting an office in Reno, just 200 miles away, to collect and invest the company’s profits, Apple sidesteps state income taxes on some of those gains.

California’s corporate tax rate is 8.84 percent. Nevada’s? Zero.

Setting up an office in Reno is just one of many legal methods Apple uses to reduce its worldwide tax bill by billions of dollars each year. As it has in Nevada, Apple has created subsidiaries in low-tax places like Ireland, the Netherlands, Luxembourg and the British Virgin Islands — some little more than a letterbox or an anonymous office — that help cut the taxes it pays around the world.

Almost every major corporation tries to minimize its taxes, of course. For Apple, the savings are especially alluring because the company’s profits are so high. Wall Street analysts predict Apple could earn up to $45.6 billion in its current fiscal year — which would be a record for any American business.

Apple serves as a window on how technology giants have taken advantage of tax codes written for an industrial age and ill suited to today’s digital economy. Some profits at companies like Apple, Google, Amazon, Hewlett-Packard and Microsoft derive not from physical goods but from royalties on intellectual property, like the patents on software that makes devices work. Other times, the products themselves are digital, like downloaded songs. It is much easier for businesses with royalties and digital products to move profits to low-tax countries than it is, say, for grocery stores or automakers. A downloaded application, unlike a car, can be sold from anywhere.

[onehandle]

1. NYT means how ALL tech companies sidestep billions in global taxes.

Apple is the top dog, so mediocre tech companies (all the rest) are less interesting in headlines.

[Zalatix]

2. True, I ran into the text limit on the header anyway.

[kenny blankenship]

3. Can't Hear You!

I'm too busy being a 2 dimensional cut-out of a human being, totally eclipsed by the coolness of the gadgetry I consume.

[Elwood P Dowd]

4. Apple did not send 750,000 jobs out of the country.

They have 60,000 employees worldwide (about 45,000 in the US) and have never, ever employed directly or indirectly 750,000 people.

You can't blame Apple for taking advantage of laws passed by politicians (mostly repukes) that make this behavior legal. Hell, under Bush Jr the Labor Department and Commerce Department would actually assist large corporations in shipping jobs out of the country.

[Zalatix]

10. They do, through outside contractors in China.

And yes, I can blame Apple, and every other corporation. They lobbied for these laws, that's how they got this assistance from the Government. You're putting the cart before the horse.

[Elwood P Dowd]

13. Apple does not have 700,000 contractors in China.

Apple was never big in the lobby business in Washington. They are not a member of either ALEC or the US Chamber of Commerce. Just the Koch Brothers probably outspend Apple 50-1 when it comes to corporate front groups and lobbying. I remember going over the list of heavy hitters pushing free trade, outsourcing, deregulation, and tax changes back in the 1990s when all this started, and Apple was not a major player.

[Zalatix]

14. Whatever. They have 750,000 workers through their outside contractors. Deal with it.

[FredisDead]

5. Almost every major corporation tries to minimize its taxes

I fixed it.

Almost every major "Conservative" corporation tries to minimize its taxes

[former9thward]

6. Are there liberal corporations who try and maximize taxes?

[Elwood P Dowd]

7. Except Apple is not a "Conservative" corporation politically.

What "Conservative" corporation would have Al Gore on the Board so many years and give the CEO job to Tim Cook, a guy who voted for Obama?

[Zalatix]

12. Smoke and mirrors.

[Initech]

8. Time for the IRS to get off its ass and start closing some loopholes.

[dkf]

9. Better they avoid some of the taxes than they move to another country.

States and countries will fight for these jobs. Apple is an international company now.

[Zalatix]

11. Let them move, then we block them from selling anything here at all.

[dkf]

15. Why would we do that? And let Samsung take over?

[Zalatix]

16. Tariffs. Or.. we could just inflate our currency and make all imports outrageously expensive.

But the free traitor crowd wouldn't go for that. So instead our trade deficit will continue to naturally devalue our currency and bring us to the same conclusion of import price hyperinflation.