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(Bloomberg)   Apple would very much like to not pay any taxes on their $102 billion overseas cash horde. Subby would like free hookers and blow   (bloomberg.com) divider line 50
    More: Unlikely, Mac computers, CEO  
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1315 clicks; posted to Business » on 17 May 2013 at 8:21 AM (47 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-05-17 01:22:09 AM
Important to note that the 102 billion offshore cash horde is completely from offshore sales.  Not a single penny from US sales.  Apple doesn't want a free ride to repatriate the money... they, like many many other large corporations would like a rate lower than 35% to bring that $$ back to the US.  I agree with Apple and all the other companies here.  Bringing that money back to the US economy is a win for everyone except the foreign countries that hold the money now.  Hopefully some good will come of this.
 
2013-05-17 01:37:01 AM
Unless Cook is willing to open up every last accounting book to prove beyond a doubt that not a penny of their US profits were transferred off shore, he can shove his "idea" up his iAss.

This shiat is exactly why "subsidiaries" are a joke.  Youhave your HQ in America?  then you pay tax on everything as if it were here.  You want to pay lower taxes in EU?  Then setup shop there.  But, you can't have it both ways.
 
2013-05-17 01:39:17 AM
Important to note that the 102 billion offshore cash horde is completely from offshore sales.  Not a single penny from US sales.  Apple doesn't want a free ride to repatriate the money... they, like many many other large corporations would like a rate lower than 35% to bring that $$ back to the US.  I agree with Apple and all the other companies here.  Bringing that money back to the US economy is a win for everyone except the foreign countries that hold the money now.  Hopefully some good will come of this.

You do realize the actual rate is lower than the 35% quoted since they deduct any foreign taxes paid? This is like saying Donald Trump pays 39%.

So if they averaged 20% foreign tax then the amount paid to the US would be 15%. Now I realize that 15.3 Billion is a lot but compared to the 86.7 Billion they keep, it is nothing to complain about
 
2013-05-17 02:09:10 AM
Ohh! Apple wanting to bring back their money threads! I love these!

I had an idea. I was thinking that taxes on foreign income should be based upon time doing nothing at all. For example, someone investing in a multi-billion dollar investment who actively trades the money wont be affected, but money that has sat around in a bank doing nothing will.

30 days kept offshore then brought back: 20%
45 days: 25%
and it rises all the way to 360 days, 99%

This would encourage companies who are sitting on cash piles doing nothing to repatriate the funds.
 
2013-05-17 05:08:25 AM
For many years corporations had no safe haven and accounting tricks to accumulate massive wealth overseas tax free.

Before the dark times.

Before Reagan.
 
2013-05-17 07:52:07 AM

teknishn: they, like many many other large corporations would like a rate lower than 35% to bring that $$ back to the US.


Actually, everyone wants a rate lower than 30%.

It's a psychological phenomenon. The maximum anyone feels comfortable paying in tax like payments is 30%, and of course since that's the extreme end of the bell curve anything lower is preferable.

After 30%, belligerence sets in and you wind up fighting, even if you can afford it and then some.
 
2013-05-17 08:40:25 AM
Think of the little people Apple .

encrypted-tbn3.gstatic.com
 
2013-05-17 08:58:03 AM

cman: 30 days kept offshore then brought back: 20%
45 days: 25%
and it rises all the way to 360 days, 99%

This would encourage companies who are sitting on cash piles doing nothing to repatriate the funds.


Not really, as the US has no jurisdiction over foreign funds, so you're just encouraging companies to never bring that money to the US.  The issue is not that those funds exist, it's what to do with them when they do come into the US.  Your plan would have no incentive to ever invest in the US.
 
2013-05-17 08:59:18 AM
Just remember folks. Corporations are people just like you and I.
 
2013-05-17 09:06:31 AM

Grand_Moff_Joseph: Unless Cook is willing to open up every last accounting book to prove beyond a doubt that not a penny of their US profits were transferred off shore, he can shove his "idea" up his iAss.

This shiat is exactly why "subsidiaries" are a joke.  Youhave your HQ in America?  then you pay tax on everything as if it were here.  You want to pay lower taxes in EU?  Then setup shop there.  But, you can't have it both ways.


Umm... Maybe I'm naive, but why would Apple transfer money out of the US only to bring it right back? And don't they have to pay taxes each way?
 
vpb [TotalFark]
2013-05-17 09:10:18 AM
If they didn't make the money here, they aren't really REpatriating it are they?
 
2013-05-17 09:13:45 AM
Why don't they just spend it there? Is there nothing in the local economy worth getting, and if not, how do the people there manage to afford their products in the first place?
 
2013-05-17 09:16:29 AM
They'll just wait until we have a Republican President again when there's a convenient Tax Holiday to Re-PATRIOT this cash.
 
2013-05-17 09:17:00 AM
Make stuff overseas and use child slaves to make it.
Sell it to douchebags who don't care.
Take the money and keep it overseas.

Apple = China.
 
2013-05-17 09:19:22 AM
Yeah, because the last repatriation went so well for us and didn't end up as a tax free money grab for stockholders an executives.
 
2013-05-17 09:22:15 AM

vudukungfu: Make stuff overseas and use child slaves to make it.
Sell it to douchebags who don't care.
Take the money and keep it overseas.

Apple = China.


0/10
 
2013-05-17 09:40:23 AM
After the last holiday where we got burned and the execs and stockholders got pay outs?  No thanks.  Tax it all at the same rate, whether foreign or domestic, and if you don't declare your funds you don't get to count that against your tax obligation.  If you want a tax cut,  that money better go to improving our lives, not just you and your fat cat buddies.
 
2013-05-17 09:52:47 AM
If they pull it out of another country, aren't they screwing over that country? Should we be actively encouraging Apple to cheat other countries?
 
2013-05-17 09:55:38 AM
The US Supreme Court decided the issue almost a century ago.

It is legal for someone to arrange their financial affairs (legally) to limit taxes.

There is no law, other than the mantra of "soak the rich companies", that requires companies to pass overseas income through the US to be taxes.
 
2013-05-17 10:07:11 AM
Hey, subby. Please put me on the invite list should your desires come to fruition.

Thanks!
 
2013-05-17 10:35:58 AM
HOARD, dammit.
 
2013-05-17 10:41:11 AM
No.

Also, go fark yourselves.
 
2013-05-17 10:42:41 AM
If it was earned and tax in another country why should the US tax it all?
 
2013-05-17 10:49:53 AM

cchris_39: If it was earned and tax in another country ...


And developed and marketed from the U.S..... and built in China with parts sourced from Japan before being shipped under a Swiss flagged vessel....

The economics of global companies is not that simple and you shouldn't try to treat their tax structure as being that simple.

Besides, they don't pay taxes to the U.S. on the taxes already paid to the foreign entity.
 
2013-05-17 10:57:40 AM

cchris_39: If it was earned and tax in another country why should the US tax it all?


See: http://en.wikipedia.org/wiki/Double_Irish_arrangement
 
2013-05-17 11:00:30 AM

cchris_39: If it was earned and tax in another country why should the US tax it all?


If the corporation was in the US, then some of the work was necessarily done here. To say otherwise would be to say that the corp doesn't do anything.

Otherwise, if I can trust Fark commenters, the corp rate paid in the US is discounted by the other country's tax rate.

Still confused.
 
2013-05-17 11:14:22 AM

teknishn: Important to note that the 102 billion offshore cash horde is completely from offshore sales.  Not a single penny from US sales.  Apple doesn't

want a free ride to repatriate the money... they, like many many other large corporations would like a rate lower than 35% to bring that $$ back to the US.  I agree with Apple and all the other companies here.  Bringing that money back to the US economy is a win for everyone except the foreign countries that hold the money now.  Hopefully some good will come of this.


10/10. this troll  got everbody

idiot troll of the day is crownded
 
2013-05-17 11:17:50 AM

Gimli_Gloin: It is legal for someone to arrange their financial affairs (legally) to limit taxes.


To a point. You're legally allowed to exchange $9,999 per day at a casino without the casino having to report it to the IRS. But if you exchange $9,999 per day for 100 days straight to hide a big win, that's structuring, which is illegal.

I'm wondering how much of this overseas cash was actually earned here, but spent on "subsidiary fees" or such. Starbucks was recently caught doing this overseas. They can show a loss in the UK and pay no tax there because all of their operating profits are paid as a "franchise fee" to Starbucks in Ireland, where corporate taxes are very low.
 
2013-05-17 11:28:12 AM

cchris_39: If it was earned and tax in another country why should the US tax it all?


Because our federal resources are used in those countries to defend trade and intellectual property rights of Apple Inc.
 
2013-05-17 11:39:12 AM

notto: cchris_39: If it was earned and tax in another country why should the US tax it all?

Because our federal resources are used in those countries to defend trade and intellectual property rights of Apple Inc.


Good point.
 
2013-05-17 11:53:00 AM
I would be willing to waive taxes on repatriated funds provided that those funds are spent within 1 year on capital investment rather than dividends or executive pay.
 
2013-05-17 12:43:36 PM
Another anti-Apple headline, sponsored by Samsung.
 
2013-05-17 12:49:08 PM
No, let Apple keep it overseas so they can reinvest it there.  People here don't need the investment or jobs as much as our government does.
 
2013-05-17 01:07:40 PM

bingethinker: Another anti-Apple headline, sponsored by Samsung.


si0.twimg.com
 
2013-05-17 01:40:06 PM
Am I the only guy who does not want hookers and blow? For one hookers are usually disgusting. Two, cocaine is just not for me. I never did like it. So if I'm ever invited to a party with those two things I think I'll pass.
 
2013-05-17 01:47:54 PM

runcible spork: HOARD, dammit.


Thank you. A  hoard is a large accumulation of things, while a  horde is a large accumulation of people.
 
2013-05-17 02:19:53 PM

jigger: For one hookers are usually disgusting


Like so many other things in life, it seems that you get what you pay for.
 
2013-05-17 02:36:08 PM

jigger: Am I the only guy who does not want hookers and blow? For one hookers are usually disgusting. Two, cocaine is just not for me. I never did like it. So if I'm ever invited to a party with those two things I think I'll pass.


www.polyfro.com
 
2013-05-17 02:57:15 PM

skozlaw: bingethinker: Another anti-Apple headline, sponsored by Samsung.

[si0.twimg.com image 350x348]


I  thought you had to be older than 12 to post here.
 
2013-05-17 03:08:43 PM

jigger: Am I the only guy who does not want hookers and blow? For one hookers are usually disgusting. Two, cocaine is just not for me. I never did like it. So if I'm ever invited to a party with those two things I think I'll pass.


More for me!
 
2013-05-17 04:17:38 PM

bingethinker: skozlaw: bingethinker: Another anti-Apple headline, sponsored by Samsung.

[si0.twimg.com image 350x348]

I  thought you had to be older than 12 to post here.


I'd rather be twelve with the chance to mature still ahead than a bitter old Apple nerd who apparently missed his opportunity.

posted from my Samsung Galaxy FarkYou
 
2013-05-17 04:21:49 PM
Subby, if they're free, they're just sluts.
 
2013-05-17 04:55:24 PM

Stile4aly: I would be willing to waive taxes on repatriated funds provided that those funds are spent within 1 year on capital investment rather than dividends or executive pay.


So then they repatriate the exact amount of funds they planned to spend on capital investment next year anyway, and increase their dividends and executive pay by the same amount. Nice extra loophole to avoid tax you just tried to create, but no thanks.
 
2013-05-17 07:11:57 PM
Tim Cook needs to focus less on furthering Apples wealth beyond reason and more on why my brand new iPod won't sync with iTunes.
 
2013-05-17 07:46:49 PM
Apple every single multinational corporation in America would very much like to not pay any taxes on their $102 billion overseas cash horde.

Fixed that for everyone.

All of the large multinational corporations are using accounting tricks to avoid paying their fair share of taxes.

Here's a concrete example:

Tyler Hurst swiped his debit card at a Walgreens pharmacy in central Phoenix and kicked off an international odyssey of corporate tax avoidance.

Hurst went home with an amber bottle of Lexapro, the world's third-best selling antidepressant. The profits from his $99 purchase began a 9,400-mile journey that would lead across the Atlantic Ocean and more than halfway back again, to a grassy industrial park in Dublin, a glass skyscraper in Amsterdam and a law office in Bermuda surrounded by palm trees.

While Forest Laboratories Inc., the medicine's maker, sells Lexapro only in the U.S., the voyage ensures most of its profits aren't taxed there -- and they face little tax anywhere else. Forest cut its U.S. tax bill by more than a third last year with a technique known as transfer pricing, a method that carves an estimated $60 billion a year from the U.S. Treasury as it combines tax planning and alchemy.

Transfer pricing lets companies such as Forest, Oracle Corp., Eli Lilly & Co. and Pfizer Inc., legally avoid some income taxes by converting sales in one country to profits in another -- on paper only, and often in places where they have few employees or actual sales.

The trek taken by Forest's profits on Hurst's $99 purchase involves a corporate structure nicknamed "the Double Irish," registered offices that occupy no real estate and a set of U.S. rules that one tax attorney calls "unenforceable." It provides a case study in how U.S. companies use transfer pricing to avoid paying taxes.

U.S. companies amassed at least $1 trillion in foreign profits not taxed in the U.S. as of the end of last year, according to data compiled by Bloomberg. That cumulative total, based on filings by 135 companies, increased 70 percent over three years, from $590 billion in 2006.

While some of the offshore earnings reflect sales abroad, much of the growth results from expanding use of transfer pricing, said Martin Sullivan, a tax economist who formerly worked for the Treasury Department and Arthur Andersen LLP.

The system allows for creating paper transactions between subsidiaries of the same company to allocate expenses and profits to selected countries. For instance, when technology firms license their patents to offshore subsidiaries in low-tax countries, profits from sales overseas are booked to the foreign units, not the U.S. parents. The tax savings add to profits.

"A very significant part of this accumulation of profits offshore is the artificial shifting of profits using transfer pricing," said Sullivan, now a contributing editor to the trade publication Tax Notes. "There's been a significant increase in its aggressiveness over the past decade."


This is a company headquartered in the US. It has nearly all it's employees in the US. It's sales are in the US.

Yet it manages to avoid paying it's taxes by using accounting tricks to pretend its' profit happens in places with low or no corporate taxes.

That article spells out what is happening in a comprehensive tl; dr way if you are interested.
 
2013-05-17 09:32:31 PM

BullBearMS: Fixed that for everyone.


Well, everyone except the people who know the difference between "hoard" and "horde."
 
2013-05-18 01:55:22 AM

xria: Stile4aly: I would be willing to waive taxes on repatriated funds provided that those funds are spent within 1 year on capital investment rather than dividends or executive pay.

So then they repatriate the exact amount of funds they planned to spend on capital investment next year anyway, and increase their dividends and executive pay by the same amount. Nice extra loophole to avoid tax you just tried to create, but no thanks.


Good point.

Here's the problem; I see the value in repatriating funds but not if they're going to be used for things that do not help the economy.  How do we incent valuable repatriation while disincenting dividend payouts and golden parachutes?
 
2013-05-18 02:10:38 AM
Transfer Pricing - in my MBA program in International Business this was one of the biggest topics we covered.  Basically unless the IRS is allowed to keep a staff of several dozen auditors full time at Apple's headquarters, with unlimited access to all files and emails, it is really difficult for the IRS to dispute Apple's claims of exactly where their profits were earned and how the costs and profits were allocated among the hundreds of entities Apple controls around the world.

Meanwhile, Apple most definitely keeps a staff of dozens or hundreds of lawyers and accountants working full time to minimize Apple's taxable activities.

Who do you suppose has the advantage in that particular tussle?
 
2013-05-18 03:15:06 AM

El Pachuco: Who do you suppose has the advantage in that particular tussle?


The wealthy and their corporations have been allowed to dodge paying their fair share of the tax burden for quite some time now. The vast majority of the income for the obscenely wealthy comes in the form of Capital Gains which gets taxed at a rate lower than the standard income tax rate for someone in the working class making only about $35,000 a year.

Meanwhile, the rich scream about how their rate is too high.

Corporations, likewise scream about the tax rate while they similarly manage to dodge paying a rate as high as working stiffs pay on their income.

Procter & Gamble, the Cincinnati-based company behind Pampers diapers and Tide detergent, reported a federal tax burden in 1969 that was 40 percent of its total profits, a typical rate in those days.

More than four decades later, P&G is a very different company, with operations that span the globe. It also reports paying a very different portion of its profits in federal taxes: 15 percent.

The world's biggest maker of consumer products isn't the only one. Most of the 30 companies listed on the country's most famous stock index, the Dow Jones industrial average, have seen a dramatically smaller percentage of their profits go to U.S. coffers over time, even as their share prices have driven the Dow to an all-time high.

A Washington Post analysis of data from S&P Capital IQ, a research firm, found that in the late 1960s and early 1970s, companies listed on the current Dow 30 routinely cited U.S. federal tax expenses that were 25 to 50 percent of their worldwide profits. Now, most are reporting less than half that share.

The reason is not simply a few loopholes tucked deep in the tax code. It's far bigger: the slow but steady transformation of the American multinational after years of globalization. Companies now have an unprecedented ability to move their capital around the world, and the corporate tax code has not kept up with the changes.

Just the opposite, in fact. Experts say the U.S. code has encouraged companies to shift their income overseas, where it is more lightly taxed by the U.S. government. Many firms, in turn, have discovered that just as they can move their manufacturing to other parts of the world, so, too, can they shift their income to far-flung tax havens such as the Cayman Islands.

The result is lower revenue here that could pay for infrastructure, education and other services that support domestic growth - and that make life easier for U.S. firms.


So let's be clear. A working stiff making less than 35K a year pays a higher tax rate than billionaires do on Capital Gains or than a huge Billion dollar corporation like Proctor and Gamble does.

Frankly, it's torches and pitchforks time.
 
2013-05-18 05:32:48 PM

El Pachuco: Transfer Pricing - in my MBA program in International Business this was one of the biggest topics we covered.  Basically unless the IRS is allowed to keep a staff of several dozen auditors full time at Apple's headquarters, with unlimited access to all files and emails, it is really difficult for the IRS to dispute Apple's claims of exactly where their profits were earned and how the costs and profits were allocated among the hundreds of entities Apple controls around the world.

Meanwhile, Apple most definitely keeps a staff of dozens or hundreds of lawyers and accountants working full time to minimize Apple's taxable activities.

Who do you suppose has the advantage in that particular tussle?


Would you say it's easier for the IRS/Gov't to thoroughly investigate individuals than it is to investigate corporations?
 
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