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Remember that the point of these exercises, for the company, is not to avoid double taxation, but to avoid even so much as single taxation, by ensuring that the
by ubernostrum 9y ago
Remember that the point of these exercises, for the company, is not to avoid double taxation, but to avoid even so much as single taxation, by ensuring that the only country in which they legally make profit is one which won't tax them for turning a profit. The actual sales which eventually (after many twists and turns of international finance) resulted in those profits may have happened anywhere, and it's meant to be difficult to untangle exactly where (since if you could easily do that you could tax it).
A better solution, of course, would be a tax on the value of goods sold, at the location where the sale occurs, since it's hard to argue that an Apple Store in the US whose customer was standing in front of the register was somehow actually in a Caribbean tax haven.
- valuearb 9y agoExcept that Apple pays massive amounts of taxes, more than any company in the history of the world. I shudder to imagine how much you think they should pay.
- ubernostrum 9y agoSome cursory Googling indicates that the last few years Apple has managed to keep its taxes paid at a rate of between 18% and 19%. For comparison, the Republican tax plan currently being debated in Congress is capping at 20% or 21% (depending on which day's negotiations you're looking at). And I personally am paying a rate around 36%. I wonder what rate you think Apple and other large companies should be paying, and how much the rest of us would have to pay to give them that cut.
- marcoperaza 9y agoAnd when Apple’s owners make their share of that profit through capital gains and dividends, the government will take another cut.
- ubernostrum 9y agoYou mean when they pay the capital-gains tax rate, which is much lower than the rate us ordinary mortals pay on our income? The poor oppressed billionaires and even, yes, the mere multi-multi-millionaires, do not have my sympathy. I doubt you're going to change that.
- marcoperaza 9y agoUh, this isn't about sympathy. I'm just pointing out that once you add the levels of taxation, it's about the same as the income tax rate. What looks like favorable treatment is just the government taking multiple cuts of the profits, where for wages it just takes one bigger one.
- valuearb 9y agoThis isn’t about billionaires. A poor retiree in CA with Apple stock is losing close to 60% of their dividends to taxes: The reason capital gains rates are lower than individual income rates is partial compensation for the effects of inflation. If inflation is 2% per year and your investment increases 20% over 10 years, you lost money but still owe taxes. During high inflationary periods this effect kills the stock market, because taxes make investing becomes a guaranteed loser. The reason dividend rates are so low is that the money has already been taxed multiple times in its way to the shareholder. Foreign, State and Federal Corporate income taxes. Your 20% dividend rate is just the tail end of about 60% in total taxes, including state income taxes too.
- deleted 9y ago[deleted]
- ubernostrum 9y ago"A poor retiree in CA" doesn't own AAPL. Not directly, not through a 401(k) or other vehicle. They're living off Social Security payments. And retirement investment vehicles, smartly managed, start moving out of stocks and into less volatile securities as you reach actual retirement. So if that retiree is still in AAPL post-retirement, there are other issues going on.
- valuearb 9y agoI think Apple and other corporations should pay zero in income taxes. Because taxing investment makes no sense. Let alone sextuple-taxing it like we do today. And your googling is in accurate. Apple pays 24.6% in taxes.