Related:
"Apple
said Tuesday its fiscal second-quarter profit almost doubled to $11.6 billion."
"Apple slashes its tax bill with legal, cutting-edge practices" by Charles Duhigg and David Kocieniewski |
New york times
April 29, 2012
RENO - Apple, the world’s most profitable technology
company, has done something central to
its corporate strategy: It has avoided millions of dollars in taxes in
California and 20 other states....
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
countries such as Ireland, the Netherlands, Luxembourg, and the British
Virgin Islands - some little more than a letterbox in Luxembourg - that
help cut the taxes it pays around the world.
Do not war-profiteers like Halliburton do the same thing?
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 $41.4 billion in its current fiscal year - a record for any
US business.
Yeah, that's billion with a B, readers. And they are on a pace to beat it.
When someone in the United States buys an iPhone, iPad, or other
Apple product, a portion of the profits from that sale is often
deposited into accounts controlled by Braeburn Capital, and then invested in
stocks, bonds, or other financial instruments, say company executives.
Some profits from those investments are shielded from California tax
authorities by virtue of Braeburn’s Nevada address.
Since founding Braeburn, Apple has earned more than $2.5 billion in
interest and dividend income on its cash reserves and investments around
the globe. What’s more, Braeburn allows Apple to lower its taxes in
other states because many of those jurisdictions use formulas that
reduce what is owed when a company’s financial management occurs
elsewhere.
It's not that I'm against Apple making money; however, this is in the face of the hollowing out and destitution of the American middle class.
While Apple’s Reno office helps the company avoid state taxes, its
international subsidiaries, particularly the company’s assignment of
sales and patent royalties to other nations - help reduce taxes owed to
the US and other governments....
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 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 can be sold from
anywhere.
Apple, former executives say, has been particularly talented at
identifying legal tax loopholes and hiring accountants who are known for
their innovation....
Apple was a pioneer of an accounting technique known as the
“Double Irish with a Dutch Sandwich,’’ which reduced taxes by routing
profits through two Irish subsidiaries and the Netherlands and then to
the Caribbean. In 2004, Ireland, a nation of less than 5 million, was
home to more than one-third of Apple’s worldwide revenues, according to
company filings.
Without such tactics, Apple’s federal tax bill in the United States
most likely would have been $2.4 billion higher last year, according to a
recent study by a former Treasury Department economist, Martin A.
Sullivan. As it stands, the company paid cash taxes of $3.3 billion
around the world on its reported profits of $34.2 billion last year, a
tax rate of 9.8 percent. (Apple does not disclose what portion of those
payments were in the US, or what portion are assigned to previous or
future years.)
That's all?
By comparison, Walmart last year paid worldwide cash taxes of $5.9
billion on its booked profits of $24.4 billion, a tax rate of 24
percent, which is about average for non-tech companies.
Walmart has it's own problems these days.
Apple said it “has conducted all of its business with the highest of
ethical standards, complying with applicable laws and accounting
rules.’’
That doesn't make it right.
Apple also said it “pays an enormous amount of taxes which help our
local, state, and federal governments. In the first half of fiscal year
2012, our US operations have generated almost $5 billion in federal and
state income taxes, including income taxes withheld on employee stock
gains, making us among the top payers of US income tax.’’
And I'm not for raising their tax. I'm for cutting back on the empire abroad and tyranny at home. There will be plenty of money for all our needs once we get rid of the theft and waste.
--more--"
Also see: State Street Stealers
Not only did they and others not pay taxes, they got a big old tax check from the government!
You SEE where your TAX LOOT is going?
