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How Apple avoids paying taxes in CA

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Re: How Apple avoids paying taxes in CA

#111

Post by jbooth »

zamfi wrote: post #75
jbooth wrote: post #50

Earlier quoted context omitted.

No, I mean the small businesses that have created almost all of the new jobs over the last 20 years. A few here and a few there. Some of them got really big. Go check out bls.gov.

Can you give a more specific link to the bureau of labor statistics? Assuming you're using the typical "500 employees" definition of small business, US census data doesn't seem to bear you out. For the period 1988 to 2003, see table 2c here: http://www.census.gov/epcd/www/smallbus.html The percentage of paid employees employed by organizations with 500+ employees increased in the period 1988 to 2004, to 49.1% - as th…

Everybody says it all the time. Maybe they're all wrong, but probably you are. I don't mean to be rude but I'm not writing a book report here and am not going to spend my morning looking for charts.

Consider that Google's now a very large employer but were a very small business 10 years ago. The way you view that and similar cases probably influences the outcome quite a bit. Small companies get big, they get bought out, or they fail. Either way they created jobs for a little bit, and all 3 of those cases wouldn't be captured by the single year snapshot of data you linked to (why 2002?).

Re: How Apple avoids paying taxes in CA

#112

Post by jbooth »

zamfi wrote: post #83
jbooth wrote: post #77

Earlier quoted context omitted.

Hm, you actually may be right, assuming no accounting and no income from capital gains, high-paid salaried workers do pay more in taxes. And they're probably earning their pay. So I was wrong on that part of the math. Meanwhile, people who are supremely highly paid (in the > 500k -> millions range) usually get a big chunk of it in options. That's fine as a payment plan, I even agree with it, but they should pay the g…

Option grants are taxed as income too, the advantage to options is that any increase in stock price can be taxed as capital gains if you exercise the option immediately and hold the stock for more than 1 year. Direct stock grants are also taxed as income, with the same caveat that stock value appreciation can be taxed at the lower capital gains rate. It sounds like your beef is with the capital gains tax rate, not in…

My beef is precisely with the culture of tax avoidance and the loopholes that you're so neatly sidestepping in this conversation. Ok, maybe it's not quite so bad as I'm making it out until you consider the loopholes and everything. In reality, the overwhelming majority of people earning > $1 million are probably paying a lower % of their income in taxes than I am, after deductions, spending a significant chunk of my yearly salary on accountants, the whole mess. That's ridiculous.

Re: How Apple avoids paying taxes in CA

#113

Post by mikecane »

dedward wrote: post #42
btmorex wrote: post #17

Earlier quoted context omitted.

That may be true, but the simple fact is that it's a lot easier for a large corporation to minimize its taxes than it is for a small business or individual. For example, a company like apple can afford to pay 10 people full time to move around money and assets in order to minimize taxes. Those people will save Apple far more than it costs to employ them. A 5 person company not only can't match that effort, but if the…

While I'm not arguing the system is perfectly fair - those large corporations also create jobs, and pay a huge amount of tax in raw numbers. People look at the percentages and say "Ohh look how they cheat...." - but look at the raw figures, and see where the tax dollars are really coming from. Joe average 9-5 worker doesn't create jobs, or employ hundreds or thousands of people, and he does get tax breaks for certain…

>>>Joe average 9-5 worker doesn't create jobs, or employ hundreds or thousands of people

And where would all the companies be that sell to Joe Average if Joe Average was out of work? How many of those jobs would vanish for all those other Joe Averages?

Joe Average also doesn't create books or movies or music -- but we depend on him to spend his money so those who do can keep doing so.

Spit on Joe Average and you are cutting your own throat.

Re: How Apple avoids paying taxes in CA

#114

Post by loewenskind »

dedward wrote: post #43
jbooth wrote: post #38

Earlier quoted context omitted.

Yeah, but they make more than 50% and more than 3/4 of the income, respectively. Richer people pay lower taxes as a percentage of their income than the middle class. Much lower. It'd be lower even if they did it all by the book and didn't hire expensive accountants and use offshore accounts, tax havens and all of that. Once you add that stuff in it's significantly lower. It's a bug, not a feature. Meanwhile, presumab…

Taking a wealthy friend as an example, and watching how many jobs he's created, how many charities he's created, and how many lives he's changed - plus the sheer raw numbers of dollars he paid in taxes on top of all that - I don't really care if the percentage is less than mine. I didn't create 500 jobs or donate hundreds of thousands of dollars to real-life charities every year. EDIT: That doesn't mean I think the s…

Anecdotes don't prove anything. Plenty of rich people don't create any jobs (directly anyway) and if they are giving to charities it's usually for tax reasons and/or PR. If you had the money your rich friend has you almost certainly would have donated a similar amount to charity.

Re: How Apple avoids paying taxes in CA

#115

Post by URSpider94 »

zmmmmm wrote: post #65
riferguson wrote: post #10

Judge Learned Hand: "Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one's taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for…

That's interesting. I know little of US tax laws but in my country if an arrangement has no legitimate purpose other than to minimize tax then it can be seen as tax evasion and the tax department can choose to tax under an alternative regime that they decide matches its "true" nature. Similar to how if you claim to be a contractor but you do all your work for one company they can decide to treat you as an employee. O…

That's generally true in the USA, but the catch here is that the states are sovereign entities. Different states have different tax structures, in part to attract residents, business and investment.

Re: How Apple avoids paying taxes in CA

#116

Post by jcl »

tzs wrote: post #41
technomancy wrote: post #6

MS does the same, though they have to buy off statesmen to get away with it: http://boingboing.net/2010/04/23/microsoft-wins-its-1.html

Quote from the article you link to: "Asked if his son was on board with the tax initiative, Gates Sr. said, improbably, they hadn't discussed it". Why does Doctorow think its improbable that Gates Sr hasn't discussed this with his son?

FWIW, Doctorow attributes the entire quoted paragraph to "Jeff", who apparently runs the microsofttaxdodge.com blog; Jeff has incentive to think Microsoft is behind Gates Sr.'s tax proposal, as it helps his site's argument.

Re: How Apple avoids paying taxes in CA

#117

Post by duncanj »

jbooth wrote: post #111
zamfi wrote: post #75

Earlier quoted context omitted.

Can you give a more specific link to the bureau of labor statistics? Assuming you're using the typical "500 employees" definition of small business, US census data doesn't seem to bear you out. For the period 1988 to 2003, see table 2c here: http://www.census.gov/epcd/www/smallbus.html The percentage of paid employees employed by organizations with 500+ employees increased in the period 1988 to 2004, to 49.1% - as th…

Everybody says it all the time. Maybe they're all wrong, but probably you are. I don't mean to be rude but I'm not writing a book report here and am not going to spend my morning looking for charts. Consider that Google's now a very large employer but were a very small business 10 years ago. The way you view that and similar cases probably influences the outcome quite a bit. Small companies get big, they get bought o…

I assume Google created more jobs in the rise from 501 to >20,000 employees than they did in the 2-500 period.

I have heard statistics that a lot of the creation of jobs occurs with small business. Also, that a lot of the job losses occur at small businesses. The net jobs created are reflected in the bls statistics that show increase in employment among different kinds of businesses.

Re: How Apple avoids paying taxes in CA

#118

Post by zamfi »

jbooth wrote: post #111
zamfi wrote: post #75

Earlier quoted context omitted.

Can you give a more specific link to the bureau of labor statistics? Assuming you're using the typical "500 employees" definition of small business, US census data doesn't seem to bear you out. For the period 1988 to 2003, see table 2c here: http://www.census.gov/epcd/www/smallbus.html The percentage of paid employees employed by organizations with 500+ employees increased in the period 1988 to 2004, to 49.1% - as th…

Everybody says it all the time. Maybe they're all wrong, but probably you are. I don't mean to be rude but I'm not writing a book report here and am not going to spend my morning looking for charts. Consider that Google's now a very large employer but were a very small business 10 years ago. The way you view that and similar cases probably influences the outcome quite a bit. Small companies get big, they get bought o…

I'm now speculating, but I'd guess that a very small percentage of small businesses ever become big businesses, though it's almost surely true that all big businesses were at some point small businesses.

Your original argument seems to have been that the government should encourage innovative businesses, and I strongly agree with you there. I don't think business size is particularly relevant to that.

Success in business is highly complex. I'd guess that your assertion that small businesses get big, bought out, or fail is incorrect. Many small businesses remain small businesses for many years - think your corner dry cleaner or grocery.

The chart I pointed to looked at the years 1988-2004, not just 2002.

Of course, this post is no longer based in facts, just guesses. (If you're not interested in finding out the truth, I wont waste my time with real data any further.)

Re: How Apple avoids paying taxes in CA

#119

Post by eru »

jbooth wrote: post #108
eru wrote: post #90

Earlier quoted context omitted.

We don't encourage them to do this. The shareholders elected the board that is currently minimizing the taxes. If you don't like that, you can become an activist shareholder (or just an activist) and campaign for changing this company policy. This is no question of company ethics. It might be a question of the ethics of shareholding.

This thread is full of people who presumably aren't even significant apple shareholders clamoring for tax avoidance on principle, like it's some sort of honorable thing to do, sticking it to the man or something, and you hear the same in the real world as well. We do encourage them.

And why not. I am all for using loopholes while they exist, too.

Just make sure you also campaign for closing loopholes.

Re: How Apple avoids paying taxes in CA

#120

Post by eru »

jbooth wrote: post #109
eru wrote: post #95

Earlier quoted context omitted.

Indeed. But the shareholders will find somebody to do their bidding. Also you could argue that doing what you were elected to do, within the legal limits, is fine. I'd say tax minimization is a patriotic duty.

Patriotic duty, heh. Making sure you never give to charity either is a mitzvah?

At least most charities won't start wars with your money.
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