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Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

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Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#81

Post by harryh »

dangrossman wrote: post #80
harryh wrote: post #78

Earlier quoted context omitted.

When Apple designs a phone in CA, buys supplies from companies located in a dozen different countries, assembles it in China and sells it in Australia what tax should be paid and to whom? These aren't "tax loopholes." They're legitimate rules to answer this fairly complicated question.

When the income ends up on the books and taxed only in Ireland, after expensing most of it as licensing fees to a shell company in Bermuda, despite none of those things (design, sourcing, manufacturing, assembly, sales) occurring in either country, it starts looking more like a loophole than legitimate rules around taxing an international business.

None of the profits from selling things in the US goes on the Irish books. Only profits from selling things outside the US. This is done because the US (almost uniquely so) taxes worldwide earnings for companies based in the US.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#82

Post by dangrossman »

harryh wrote: post #81
dangrossman wrote: post #80

Earlier quoted context omitted.

When the income ends up on the books and taxed only in Ireland, after expensing most of it as licensing fees to a shell company in Bermuda, despite none of those things (design, sourcing, manufacturing, assembly, sales) occurring in either country, it starts looking more like a loophole than legitimate rules around taxing an international business.

None of the profits from selling things in the US goes on the Irish books. Only profits from selling things outside the US. This is done because the US (almost uniquely so) taxes worldwide earnings for companies based in the US.

What about all the other countries that they have property, employees and sales in? It's a loophole if it lets them pay nothing to any of those nations, despite being as much a corporate citizen of those nations as whatever office is next door to theirs.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#83

Post by ves »

tn13 wrote: post #57
jph wrote: post #10

Earlier quoted context omitted.

What Apple owes is clear to me: pay the standard U.S. corporate tax on the standard U.S. profits. Do the same for all countries. The Apple problem is that its lawyers are deliberately avoiding using current tax codes, and instead essentially claiming that Apple is based in Ireland, then playing shell games with what counts as U.S. sales, U.S. profits, and also U.S. property. Apple ends up paying ~10% U.S. tax, rather…

There is nothing moral about paying taxes. What Apple has earned belongs to Apple and in ideal world it should pay nothing to US government. US government should probably think of simplifying and lowering the tax to the extent that avoiding it becomes more expensive than paying it.

Keep in mind that Apple does owe the US government a significant amount, so your statement is inaccurate. Apple would not function without the infrastructure provided by the government, would not be able to protect its IP without US patents, relies on the US for its workforce in Cupertino, etc.

So while I agree with your first claim, and do think Apple should "not" be taxed (tax people, not corporations), I don't agree with your second statement.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#84

Post by sigzero »

jph wrote: post #58
bpodgursky wrote: post #11

Earlier quoted context omitted.

No! No! No! What you legally owe in taxes, in a reasonable tax structure, has NOTHING to do with your moral compass. You should be able to plug numbers into a spreadsheet and get it. I'm not saying that taxes are bad. We need tax revenue. I get that. But there should NEVER, EVER, be two legally correct answers to how much you owe. The fact that you had to spend paragraphs making your case, makes mine -- when you reso…

I agree with you and I'm updating my post to show that your position and mine are similar. We both want a reasonable tax structure. But Apple is exploiting the unreasonableness of the tax structure, e.g. by using outdated codes, shell games, tax havens, etc. Apple leaders have the opportunity and moral responsibility to stop exploiting, and start helping.

You keep saying "moral responsibility". They don't. Companies have already been telling the government what's wrong and the government refuses to change it. Apple is responsible to its shareholders bottom line.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#85

Post by harryh »

dangrossman wrote: post #82
harryh wrote: post #81

Earlier quoted context omitted.

None of the profits from selling things in the US goes on the Irish books. Only profits from selling things outside the US. This is done because the US (almost uniquely so) taxes worldwide earnings for companies based in the US.

What about all the other countries that they have property, employees and sales in? It's a loophole if it lets them pay nothing to any of those nations, despite being as much a corporate citizen of those nations as whatever office is next door to theirs.

It's not a loophole that lets them pay nothing to any of those nations. Apple pays taxes in every country it operates in.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#86

Post by ves »

tim333 wrote: post #76
bpodgursky wrote: post #8

It's great how we're living in a world where tax codes are so idiotic and complex that it takes long lawsuits to figure out what tax is actually due. It's not about following the letter of the law; it's about following the letter of the law, avoiding the court of public opinion, and coughing up whatever is necessary to stop the complaints when some politician wants to distract people from their incompetence and whip…

>How about, we admit corporate income tax is a stupid idea, get rid of it, and raise capital gains taxes Technical reasons why that doesn't work - basically it makes it too easy to avoid all tax by keeping the money in corporations. What we need is a unified global tax regime for international corporations so they can't play off each countries tax loop holes.

But you can't do anything with that money (left in the corporation) - it eventually winds up buying things for people, or being transferred to someone's bank account, at which point it will be taxed.

You could leave it on the company's balance sheets forever, but that's pretty stupid, especially if you're trying to avoid taxes, as then you just get none of the money instead of most of it.

Why not just tax the people that make up the corporations? They have to spend 51% of their time somewhere, and all taxable stuff winds up in their hands (don't tax reinvestments), so figuring out their tax obligations is simple, relatively.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#87

Post by xxpor »

rubyfan wrote: post #32
gertef wrote: post #21

Earlier quoted context omitted.

Until we have a One World Order with no nations, what do you propose?

It wouldn't matter anyway, we'd still have states. In the US, state to state regulations vary just as much. One world government would be just as screwed up.

Doesn't the UCC cover 99% of those regulations though?

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#88

Post by wookasz »

ves wrote: post #83
tn13 wrote: post #57

Earlier quoted context omitted.

There is nothing moral about paying taxes. What Apple has earned belongs to Apple and in ideal world it should pay nothing to US government. US government should probably think of simplifying and lowering the tax to the extent that avoiding it becomes more expensive than paying it.

Keep in mind that Apple does owe the US government a significant amount, so your statement is inaccurate. Apple would not function without the infrastructure provided by the government, would not be able to protect its IP without US patents, relies on the US for its workforce in Cupertino, etc. So while I agree with your first claim, and do think Apple should "not" be taxed (tax people, not corporations), I don't agr…

Thanks for saying this. I don't understand how people can forget that everyone relies on public roads, the power grid, police and armed forces, and a plethora of other expensive infrastructure items without which it would be nearly impossible to make a penny.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#89

Post by bpodgursky »

jph wrote: post #10
bpodgursky wrote: post #8

It's great how we're living in a world where tax codes are so idiotic and complex that it takes long lawsuits to figure out what tax is actually due. It's not about following the letter of the law; it's about following the letter of the law, avoiding the court of public opinion, and coughing up whatever is necessary to stop the complaints when some politician wants to distract people from their incompetence and whip…

What Apple owes is clear to me: pay the standard U.S. corporate tax on the standard U.S. profits. Do the same for all countries. The Apple problem is that its lawyers are deliberately avoiding using current tax codes, and instead essentially claiming that Apple is based in Ireland, then playing shell games with what counts as U.S. sales, U.S. profits, and also U.S. property. Apple ends up paying ~10% U.S. tax, rather…

Also... that was a really low, shameless edit:

> Specifically, the goal is to streamline tax codes to be more clear, more consistent, and more algorithmic.

Your original post said (I don't have it saved), that the goal was to make all income from US companies taxed as US income. COMPLETELY different.

It is very dishonest to completely change your post after there's a whole comment tree under you.

Re: Apple's $348M Tax Settlement In Italy Bodes Ill For Google, Facebook, Microsoft

#90

Post by rubyfan »

xxpor wrote: post #87
rubyfan wrote: post #32

Earlier quoted context omitted.

It wouldn't matter anyway, we'd still have states. In the US, state to state regulations vary just as much. One world government would be just as screwed up.

Doesn't the UCC cover 99% of those regulations though?

Nope, the tax system is pretty screwy. The whole Irish domicile thing is basically Deleware or Nevada headquartered corporation just on a larger stage.
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