U.S. Senator 'livid' about Apple's U.S. tax dealings

U.S. Senator 'livid' about Apple's U.S. tax dealings

When asked about Apple's supposed "sidestepping" of U.S. tax laws, Senator Tom Colburn (R-Okla.) said that he was "livid about that" and used the company as an example of why the country needs tax reform.

Click to expand...

Read more

Darn right he was mad!

Only politicians and their rich friends are allowed to skip out on paying taxes.

What is this country coming to?

He's "livid" about Apple's tax dealings, but supports Romney? That's just funny.

Cut it out guys..the problem with political jokes is they get elected!

I completely understand why he's upset. If a US politician can't spend money, he or she quite literally has nothing to do. That cuts into job security. Then again, they spend our money whether they have it to spend or not. So, I'm not sure what the problem is. Our successors will cover the bill as we mortgage their future labor.

Ah well. Enjoy yourself. It's later than you think...

I like how he's going after Apple, and not any of the numerous other companies that do the exact same thing.

Stretch said:

I like how he's going after Apple, and not any of the numerous other companies that do the exact same thing.

Click to expand...

It's an election year. Neither side will be very nice, so grab some popcorn and some hip-waders. The friend of my enemy is my enemy, and whatnot...

Please, I'm "livid" that a group of old men seems to think they have the right to decide women's contraceptive choices.

As a US taxpayer, I'm unhappy about the tax situation in which the tremendously wealthy (be they people or entities) are evading their responsibilities. Nobody likes taxes, but if I stop paying mine, it's a pretty safe bet I'll end up in prison at some point.

And I know from having lived abroad that all income - including that earned overseas - is still subject to taxation. I see no reason why Apple or any other US-based business ought to be exempt. We know how much they earned worldwide. Send 'em a bill. Waiting for "repatriation" is a joke.

I agree with the sentiments about corporations and tax withholding. The fact is, this could be changed if we wanted to, but it simply isn't. There are so many loopholes in the tax code for individuals and the corporations that it's easy to get by. Instead of complaining about how unfair this all is, we should be trying to find a way to either reform, overhaul or completely re-think the way this country collects taxes.

That being said, though, if you want to out econemy compete globally you have to give the corporations those breaks to keep the businesses in the US. Sure a lot of them go offshore (as Apple does) but they could be enticed to come back if the US really wanted to do so. Sadly, we don't.

The consumer pays the corporation's taxes when all is said and done. The tax liability is factored into price, just like any smart person adds in Paypal or eBay fees when listing something for sale online. Were companies to actually pass the savings along to the consumer, I'd be happy if corporations paid no taxes on income whatsoever. Somehow, I doubt they would suddenly cut prices 28 to 35% if their tax liability disappeared overnight.

baggss said:

I agree with the sentiments about corporations and tax withholding. The fact is, this could be changed if we wanted to, but it simply isn't. There are so many loopholes in the tax code for individuals and the corporations that it's easy to get by. Instead of complaining about how unfair this all is, we should be trying to find a way to either reform, overhaul or completely re-think the way this country collects taxes.

Click to expand...

The problem, as I see it anyway, is that the United States suffers from a form of bipolar disorder. Our government recognizes the very real need for to stimulate or depress various parts of our economy at different times, but the idea of the government meddling in such affairs is anathema to half our population. As a result, instead of direct, simple tax policies coupled by government action, we have the almighty "tax incentive" to encourage / coerce / beg people to do what needs to be done.

baggss said:

That being said, though, if you want to out econemy compete globally you have to give the corporations those breaks to keep the businesses in the US. Sure a lot of them go offshore (as Apple does) but they could be enticed to come back if the US really wanted to do so. Sadly, we don't.

Click to expand...

I disagree. The solution here isn't to jump head first into this race to the bottom. Rather, I would put forth the idea that tariffs would work more effectively to equalize the situation. If China's widgets will cost the same for their worldwide customers, whether they were built with near-slave labor or appropriately-treated and well-compensated employees, why would they not choose to improve the quality of life at home instead of letting foreign governments take that extra cash. Let's elevate China and others to our first world standards, rather than reducing ourselves to their Third World way of life.

XJ-linux said:

The consumer pays the corporation's taxes when all is said and done. The tax liability is factored into price, just like any smart person adds in Paypal or eBay fees when listing something for sale online. Were companies to actually pass the savings along to the consumer, I'd be happy if corporations paid no taxes on income whatsoever. Somehow, I doubt they would suddenly cut prices 28 to 35% if their tax liability disappeared overnight.

Click to expand...

I doubt they would too. In fact, there's more than enough precedent to the contrary. Just look at the music and publishing industries. How much much money is saved by electronic distribution, and yet how many works are actually commensurately cheaper? The reason typically given: lowering prices would devalue the work.

baggss said:

That being said, though, if you want to out econemy compete globally you have to give the corporations those breaks to keep the businesses in the US. Sure a lot of them go offshore (as Apple does) but they could be enticed to come back if the US really wanted to do so. Sadly, we don't.

Click to expand...

All the tax breaks in the world wouldn't be enough to offset the difference between the cost of manufacturing to the standards Apple wants here and the cost of doing the same in China.

Stretch said:

I like how he's going after Apple, and not any of the numerous other companies that do the exact same thing.

Click to expand...

He's going after Apple because Apple is perceived as being a company loved by the left wing populous. When president Obama brought Apple up in his last state of the union address, it officially put Apple in the crosshairs of republican officials.

I agree that Apple nor any other company nor individual should be evading taxes. Taxes suck but without them, everything falls apart.

Shikarnov said:

The problem, as I see it anyway, is that the United States suffers from a form of bipolar disorder. Our government recognizes the very real need for to stimulate or depress various parts of our economy at different times, but the idea of the government meddling in such affairs is anathema to half our population. As a result, instead of direct, simple tax policies coupled by government action, we have the almighty "tax incentive" to encourage / coerce / beg people to do what needs to be done.

Click to expand...

Agreed.

Shikarnov said:

I disagree. The solution here isn't to jump head first into this race to the bottom. Rather, I would put forth the idea that tariffs would work more effectively to equalize the situation. If China's widgets will cost the same for their worldwide customers, whether they were built with near-slave labor or appropriately-treated and well-compensated employees, why would they not choose to improve the quality of life at home instead of letting foreign governments take that extra cash. Let's elevate China and others to our first world standards, rather than reducing ourselves to their Third World way of life.

Click to expand...

Discerptor said:

All the tax breaks in the world wouldn't be enough to offset the difference between the cost of manufacturing to the standards Apple wants here and the cost of doing the same in China.

Click to expand...

I'd like to see China raised to first world status but that's not going to happen anytime soon, especially with the current regime trying very hard to keep that from happening. Living with that reality means we should at least try to bring the jobs back here if we can and the best method is through tax incentives and breaks. Now, and I didn't mention this in my first post, there also needs to be changes in how unions are handled and the expectation of the best of everything for the American worker. You can have a job and decent benefits or no job and no benefits. There is a reasonable balance to be struck but corporations and unions don't seem interested in working together often times and the blame game screws everyone in the long run.

Adric said:

He's going after Apple because Apple is perceived as being a company loved by the left wing populous. When president Obama brought Apple up in his last state of the union address, it officially put Apple in the crosshairs of republican officials.

I agree that Apple nor any other company nor individual should be evading taxes. Taxes suck but without them, everything falls apart.

Click to expand...

It was the liberal 'Gray Lady" that first put Apple and tax avoidance in the crosshairs...

http://www.nytimes.com/2012/04/29/b...ow-tax-states-and-nations.html?pagewanted=all

All perfectly legal.

I've far more problems with Obama's class warfare.

baggss said:

I'd like to see China raised to first world status but that's not going to happen anytime soon, especially with the current regime trying very hard to keep that from happening. Living with that reality means we should at least try to bring the jobs back here if we can and the best method is through tax incentives and breaks. Now, and I didn't mention this in my first post, there also needs to be changes in how unions are handled and the expectation of the best of everything for the American worker. You can have a job and decent benefits or no job and no benefits. There is a reasonable balance to be struck but corporations and unions don't seem interested in working together often times and the blame game screws everyone in the long run.

Click to expand...

No reasonable balance would be able to compete with a work culture where employees are forced to live on company property and be available for emergency wake-up calls after midnight to start churning away at Apple's latest design change without so much as overtime pay. The only way to realistically achieve something similar would be to hire two or three times as many workers to do the same since we have the concept of reasonable shifts here, which of course would mean a much higher cost of labor no matter which way you slice it. And that's not even touching on the fact that engineers are so rare and well-paid here that there's no way you'd be able to get enough for Apple's manufacturing plants without paying them enough to break the bank. The fact is that from a profit-maximizing point of view, the U.S. cannot compete with China when it comes to manufacturing on an enormous scale unless it turns back the clock several decades or China advances to first-world status. The former simply isn't going to happen, and the latter, as you said, will not happen any time soon.

EDIT: I want to add in a closing blurb since I don't want it to seem like I'm just posting for the sake of disagreeing. My main point in all this is that people should accept the fact that Apple will not move their manufacturing back to the U.S. at any point in the foreseeable future, and there is nothing the U.S. government can do about it. This has nothing to do with tax breaks, tax incentives, unions wanting pensions, or which country's leader wears black turtlenecks more often. The U.S. is simply in a different place from where it was during the industrial revolution, and China is now closer to that point. And believe it or not, this is not a bad thing. I imagine almost all of the people lamenting the lack of work here don't exactly have a Foxconn worker's life in mind. The U.S. work force is great at lots of things, including many that China's work force isn't. Manufacturing in iPhone/iPad quantities simply isn't one of them.

Discerptor said:

No reasonable balance would be able to compete with a work culture where employees are forced to live on company property and be available for emergency wake-up calls after midnight to start churning away at Apple's latest design change without so much as overtime pay. The only way to realistically achieve something similar would be to hire two or three times as many workers to do the same since we have the concept of reasonable shifts here, which of course would mean a much higher cost of labor no matter which way you slice it. And that's not even touching on the fact that engineers are so rare and well-paid here that there's no way you'd be able to get enough for Apple's manufacturing plants without paying them enough to break the bank. The fact is that from a profit-maximizing point of view, the U.S. cannot compete with China when it comes to manufacturing on an enormous scale unless it turns back the clock several decades or China advances to first-world status. The former simply isn't going to happen, and the latter, as you said, will not happen any time soon.

Click to expand...

You're incorrect about drastic increases in costs (Link), but dead on that the US is having problems with scale, supply chain, skills.

Discerptor said:

EDIT: I want to add in a closing blurb since I don't want it to seem like I'm just posting for the sake of disagreeing. My main point in all this is that people should accept the fact that Apple will not move their manufacturing back to the U.S. at any point in the foreseeable future, and there is nothing the U.S. government can do about it.

Click to expand...

While I don't disagree that Apple moving its workforce back to the US is unlikely in the extreme, the US government has many tools it could use to compel companies like Apple to do what's in our national best interest. Simply, it as opted not to act. Yet.

Shikarnov said:

You're incorrect about drastic increases in costs (Link), but dead on that the US is having problems with scale, supply chain, skills.

Click to expand...

That article spends a lot of time talking about fast labor being drastically cheaper in China for something that's supposed to be contradicting that assertion. As (the article and) I said, the cost isn't just in the hourly wage -- it's also in how one can provide the kind of speed and flexibility Apple gets from Foxconn's legion of on-site workers. Foxconn could do it here, but it would require a lot more workers and much higher wages. There are other cost-increasing factors like the distance between here and pieces of the supply chain, but even without those to contend with, I don't think Apple would ever be inclined to move production back to the U.S.

While I don't disagree that Apple moving its workforce back to the US is unlikely in the extreme, the US government has many tools it could use to compel companies like Apple to do what's in our national best interest. Simply, it as opted not to act. Yet.

Click to expand...

I really don't see what it could do that would be enough short of either banning/heavily penalizing foreign production by American companies and imported products or destroying worker protection laws, both of which would have effects disastrous enough that no one in office would seriously consider it.

Just a question: would this "livid" Senator who's angry at Apple for taking advantage of legal tax breaks put there by Congress by the same Tom Coburn who consistently votes with his party on subsidies for Big Oil and Big Pharma, who advocates tax cuts for billionaires and who supports all manner of corporate welfare and corporate buying of politicians?

THAT Tom Coburn?