Wednesday, May 22, 2013

Another Tax Scandal

Here's another congressional hearing on taxes that isn't getting as much publicity as the IRS scandal, but which might have (or at least should have) similar meaningful and far-reaching consequences - but probably won't.
Apple Inc. Chief Executive Tim Cook defended the technology giant's tax practices in front of Senate investigators on Tuesday, arguing the company pays all taxes due and that its use of foreign subsidiaries doesn't affect its U.S. tax bill.
I won't bore you with the details that only a CPA could love, but to make a long story short Apple has subsidiaries in different countries around the world. Like any rational organization, Apple manages its operations and cash flows in such a manner as to minimize expenses, including taxes. For some reason, certain senators are upset by this.
Sen. Carl Levin (D., Mich.), chairman of the panel, accused Apple of employing "alchemy" and "ghost companies" to escape tax collectors in the U.S. and Ireland, the base of the firm's international operations outside the Americas.
Apple, not surprisingly, sees things differently.
Countered Mr. Cook: "There's no shifting going on…We pay all the taxes we owe, every single dollar."
What do the facts have to say?

Apple paid $6 billion in corporate income taxes in 2012, a rate of 30.5%, which is slightly lower than the 35% statutory rate.

So our august congresscritters are all upset because Apple's managers are better at their jobs (minimizing corporate taxes) than the congresscritters are at theirs (writing effective tax laws).

Well, here's a modest suggestion for those senators who find this offensive.

Get off your fat asses, quit pandering to special interest groups, junk that absurd pile of dog vomit that passes for the U.S. tax code, and write some simple, common-sense tax laws.

Damn idiots...


Old NFO said...

We should be so lucky... And Apple just has better accountants... :-)

Bag Blog said...

When I heard this on NPR yesterday, I had similar thoughts.

CenTexTim said...

NFO - Ain't that the truth!

BB - Great minds think alike... :-)