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How Apple sidestepped a 2013 crackdown on its Irish tax practices

bbc.co.uk

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Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#291

Post by ubernostrum »

malandrew wrote: post #261
deong wrote: post #227

Earlier quoted context omitted.

The US government doesn't, as a general rule, care if the money has ever been here. If you as a private US citizen choose to live and work abroad, you are required to file US income taxes and declare all foreign income. And depending on the precise details of the foreign government's treaty situation and tax rates, you may be required to pay the normal US tax rate on some or all of that income. I don't know that it c…

At some point you tax people too much and they leave your country for one with better taxes. Never forget that the top 20% of citizens are responsible for like 87% of all the tax revenue the US and state governments rely on. In fact this already happens at the state level in the US: http://www.howmoneywalks.com/irs-tax-migration/ If the new cut cut cut tax plan passes and Californian's can no longer write off state i…

Never forget that the top 20% of citizens are responsible for like 87% of all the tax revenue the US and state governments rely on.

Never forget that you implicitly assumed this is because taxes on that segment are too high, rather than because various aspects of our economy were rigged to give those people a disproportionately high share of the total taxable income.

In other words: there are two ways to reduce your tax bill, and only one of them requires Congress to pass a law that puts you in a lower bracket.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#292

Post by mattnewton »

crdoconnor wrote: post #282
mattnewton wrote: post #274

Earlier quoted context omitted.

Taxing the phone or the company’s margins should have the same effect, right? They’re both costs on apple’s revenue. Barring maybe some enforcement issue or something it makes no difference how you collect it, Apple will pass some of it off to their customers and eat another percentage based on whatever the new cost/demand curve looks like to them.

>Taxing the phone or the company’s margins should have the same effect, right? Wrong >They’re both costs on apple’s revenue. Hardly. Make zero profit and you pay zero tax on that profit.

My argument is that since apple can move the price, if you tax the company they increase the cost of the phone as much as makes sense and eat the rest. If you tax the phone, they leave as much as the increase on the cost to the end user as makes sense and lower the price beyond that, eating it. In neither case are profits or demand going to zero.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#293

Post by sliverstorm »

delinka wrote: post #208
oh_sigh wrote: post #32

Earlier quoted context omitted.

What exactly is that money doing right now? What would the ramifications be of transferring that money back into the US economy?

If you mean "back into the US," then indeed there is the potential to continue sitting on that money and maybe it won't enter the US economy. If, however, you do mean to ask "...back into the US economy," then ... jobs. How they choose to place the money into the economy is definitely a question, but ultimately any use should indeed support employment of the labor force. Loan the money out? The borrower puts someone…

Unless it's paid out in dividends and executive compensation and stock buybacks. Which is what happened with the last tax holiday under Bush.

https://theintercept.com/2017/04/27/bush-already-tried-trump...

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#294

Post by seanmcdirmid »

canuckintime wrote: post #4
rrggrr wrote: post #2

If passed, and for a brief period of time, Trump's dollar repatriation tax scheme brings home some of the +2 trillion dollars sequestered abroad - including some of the billions Apple has parked offshore. http://www.businessinsider.com/trump-gop-tax-reform-plan-bil... There's something to be said for Apple's efforts to level the playing field against the favorable tax & public policies under which Samsung and Huawei…

Or the US Congress could just change the law, close the loophole and require corporations to bring the money home anyway without any tax holidays...

So wait, wouldn’t that just mean an end to USA companies operating abroad as USA companies? Microsoft has to invest money in china for example, they just can repatriate profits from China willy nippy, and China would get pissed of about it. Also, might as well make SAP do it also, even if a German company, otherwise American companies can’t compete with them.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#295

Post by tasty_freeze »

fleitz wrote: post #67
tasty_freeze wrote: post #57

Earlier quoted context omitted.

We have a system of taxation. I pay my share. I expect others to pay there share. But when the other has found some legal loophole (perhaps one they helped to put in place or at least to maintain) and avoid paying their share, then yes, I'm upset and I want them to pay their share. Why do you try to cast this as a matter of greed. Apple is getting billions of dollars in benefits from being a US-based company, directl…

You mean you pay what the government says you owe, just like Apple does... Or are you saying that you don't claim any deductions and pay the maximum allowable by the system?

I don't have the power to entice politicians to enact loopholes which I can then take advantage of.

A ambassador might take advantage of his diplomatic immunity to commit a crime with impunity. One could say, "what's wrong with that? he was acting within the law." Or one could say, "That ambassador is a vile person and is taking advantage of the system."

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#296

Post by crdoconnor »

mattnewton wrote: post #292
crdoconnor wrote: post #282

Earlier quoted context omitted.

>Taxing the phone or the company’s margins should have the same effect, right? Wrong >They’re both costs on apple’s revenue. Hardly. Make zero profit and you pay zero tax on that profit.

My argument is that since apple can move the price, if you tax the company they increase the cost of the phone as much as makes sense and eat the rest. If you tax the phone, they leave as much as the increase on the cost to the end user as makes sense and lower the price beyond that, eating it. In neither case are profits or demand going to zero.

>if you tax the company they increase the cost of the phone

Raising your prices in response to not making as much profit as you desired is not often a winning move in business.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#297

Post by landryraccoon »

crdoconnor wrote: post #251
landryraccoon wrote: post #211

Earlier quoted context omitted.

It's not corporation against nation state, it's nation state against nation state. I'm pretty sure China would be quite happy if the US punishes Apple. That means that their protectionist policy towards Huawei will be even more effective. It is difficult for me to imagine other nations either not rolling out the red carpet to bring Apple over, or giving virtually tax free giveaways to their own companies to gain smar…

>I'm pretty sure China would be quite happy if the US punishes Apple. That means that their protectionist policy towards Huawei will be even more effective. If the US put onerous taxes on the purchase of Apple phones that might be true. If the US instead just collects a larger share of Apple's profits then Apple is going to go on exactly as before and just not deliver quite as much cash to its shareholders.

Are you arguing that a 100% tax on Apple profits wouldn’t impact their competitiveness? How would they build new factories, develop new products or hire more workers without reinvesting profits into their company? Why wouldn’t a company that can raise more money from capital markets and that has the support of its government quickly overtake Apple’s position?

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#298

Post by hinkley »

crdoconnor wrote: post #249
osteele wrote: post #241

Earlier quoted context omitted.

It's a balancing act, not (just) an arms race. As a government, raise corporate taxes too high, and corporations leave and/or overseas corporations outcompete them and/or new corporations form overseas instead of domestically. Raise tariffs too high, and domestic consumer choice and quality decrease, and consumer purchasing power decreases. These aren't consequences that dissolving your domestic corporations or jaili…

>As a government, raise corporate taxes too high, and corporations leave Only when there's almost no cost to leaving, which in itself is a tax loophole. If you declare that residency is about where you do the most business and has nothing to do with which letterbox has the word "headquarters" on it then their reaction would be limited to tantrums in Wall Street Journal op eds. >or overseas corporations outcompete the…

Having to move your headquarters every time you open up a foreign market that is more lucrative than your home market is insane. Suicidal, in fact.

I don’t think you’ve thought your solution through.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#299

Post by crdoconnor »

landryraccoon wrote: post #297
crdoconnor wrote: post #251

Earlier quoted context omitted.

>I'm pretty sure China would be quite happy if the US punishes Apple. That means that their protectionist policy towards Huawei will be even more effective. If the US put onerous taxes on the purchase of Apple phones that might be true. If the US instead just collects a larger share of Apple's profits then Apple is going to go on exactly as before and just not deliver quite as much cash to its shareholders.

Are you arguing that a 100% tax on Apple profits wouldn’t impact their competitiveness? How would they build new factories, develop new products or hire more workers without reinvesting profits into their company? Why wouldn’t a company that can raise more money from capital markets and that has the support of its government quickly overtake Apple’s position?

>Are you arguing that a 100% tax on Apple profits wouldn’t impact their competitiveness?

Pretty much. It would render their stock worthless, but there's nothing about a 100% tax on realized profits from preventing a business from operating exactly as before.

>How would they build new factories, develop new products or hire more workers

With relative ease. Corporation tax is paid only on realized profits. Reinvesting earnings has often been a way of avoiding paying it at all, which is actually supposed to be a feature.

Re: How Apple sidestepped a 2013 crackdown on its Irish tax practices

#300

Post by hinkley »

toomuchtodo wrote: post #218
alasdair_ wrote: post #215

Earlier quoted context omitted.

>At the end of the day, there is no way you as a corporation can entirely subvert a nation state. There are countless examples of this happening, from the East India Company (who essentially ruled India for a century) to the United Fruit Company to present-day Shell Oil.

Can you provide an example present day of a company successfully subverting the US government? To my knowledge, they're even pursuing companies successfully outside of their jurisdiction (Kim Dotcom/MEGA).

So many that there’s a term for it: Regulatory capture.
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