Shared publicly  - 
How Apple Sidesteps Billions in Taxes Around the Globe: Some Personal Reflections

If someone asked you how much Apple paid on $34.2 Billion in profits, what would you guess? Especially if you listen regularly to the right-wing rhetoric about how tax burden is unsupportable, how jobs are being destroyed because of excessive taxes, and how companies are being made uncompetitive by their tax burden? How much?

$9 billion? $10 billion? Nah. It's $3.3 billion, or a tax rate of about 9.8%. The actual figure is likely even lower, since "Apple does not disclose what portion of those payments was in the United States, or what portion is assigned to previous or future years."

Apple, of course, is not the only one. This front page article in today's New York Times singles out Apple as an example both because Apple is now about to become the most profitable company ever, and is one of the most aggressive in tax avoidance. But the article isn't unfair to Apple. It talks about a culture of tax avoidance throughout corporate America, and in particular, at high tech firms, which have the biggest opportunities for tax avoidance because digital goods and "intellectual property" can more easily be made to appear to belong to subsidiaries in low or no-tax countries.

Big companies have armies and lawyers who outfox tax collectors by taking advantage of a patchwork of conflicting tax regimes around the world. For example:

"Apple, for instance, was among the first tech companies to designate overseas salespeople in high-tax countries in a manner that allowed them to sell on behalf of low-tax subsidiaries on other continents, sidestepping income taxes, according to former executives. Apple was a pioneer of an accounting technique known as the “Double Irish With a Dutch Sandwich,” which reduces taxes by routing profits through Irish subsidiaries and the Netherlands and then to the Caribbean. Today, that tactic is used by hundreds of other corporations — some of which directly imitated Apple’s methods, say accountants at those companies."

There's an expanded explanation of the Double Irish with a Dutch Sandwich later in the story. But this line gives one taste: "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."

I highly recommend this story. It is truly eye-opening. I'm going to post a couple of the graphs from the story separately (Note to G+ - do allow embedded graphics and multiple links! With a storify-like interface, you could do this super-easily without making people need to know HTML.) The bar graph that shows Apple's growing profits versus their relatively static taxes is here:

Alas, it is a pale shadow of the version in the print edition, which is vertical rather than horizontal, and uses a scale that takes up 3/4 of the front page. Truly eye-opening.

This graph, shows that the problem is not limited to Apple. As corporate profits have soared, the amount paid in taxes across the board has remained fairly flat. Clearly, the tax collectors are falling further and further behind the experts at tax avoidance.

But to my promised personal reflections

I can already imagine the comments of the libertarians and anti-tax advocates in the comments on this post. "Avoiding taxes is just keeping more of the hard-earned wealth you've created by being productive and successful."

But I'd like to suggest a thought experiment. Imagine that you and a large group of friends, or an extended family, decide to hold a reunion or big party that requires renting a space and some real expenses. You agree to share the expenses equally. Then one of you says, "I'm getting us a discount on the hotel from my friend, so I shouldn't have to pay my share." Another two or three say, "I'm helping with the catering, so I shouldn't have to pay." Another: "I'm willing to act as designated driver, so I shouldn't have to pay." Each time, you think, "Yeah, that's reasonable."

But before long, things get dicey. Three more people fail to send in their promised check for the deposit despite repeat nagging. The ten people who are left on the hook for the expenses say, "This is too much. We can't afford it." So you start by letting a couple of your friends, who you know are really hard up for money, off the hook. Oh sh*t, the problem just got worse for the remaining people, who now have to shoulder a bigger and bigger part of the cost (or put it on a credit card and hope that they will one day be able to pay it back.)

Somewhere along the line, you realize that you just can't afford the great party that you'd all had your hearts set on.

You have a choice: You can scale back. Or you can stop accepting all the special reasons why one friend or another shouldn't have to pay, share the costs as originally planned, and make it affordable by all working together.

Sometimes cutting back is the right choice.

But sometimes, working together, we can do things that are wonderful, that none of us could do alone.

Put it in the context of your family. Wouldn't those of you who had more resources support those who didn't? Wouldn't you shoulder more of the burden? You're well off. Your brother or cousin is not. They can't afford to make it to the family reunion, but you love them dearly. Would you help?

I can imagine the libertarians and anti-taxers again: "But that's your choice. The problem is that government has a monopoly on force, and makes us do this against our will."

Hold on: You all made an agreement in the beginning to hold this party. Then some of you decided you wanted to opt out of paying for it.

It's a bit more complicated than that, of course, because it was our ancestors who decided to hold the party, and agreed over time on how to split the costs, and a bunch of wasteful cousins ran up the tab. But we're still a family, we still care about each other, and we want to do right for each other. So we work it out, and try to be fair, and to the extent we can, generous.

That's how it is, folks. We can be a happy family, who look after each other and create joy and possibility through being together, or one that chooses to go our separate ways, and leaves a lot of happiness on the table.

P.S. I come from a large, close, and generous family. I grew up in a household where my father borrowed money to meet his charitable obligations. When my company nearly went under in 1985, my mother saved it with a loan of a large percentage of her liquid assets, with the only stipulation being that she'd ask for it back when I didn't need it any more, and someone else did. That became known in the family as a "mammy loan."

A few years later, that same money helped my brother to buy a house. As I became more successful, I paid it forward to other family members as well.

I look at families that are successful. They love and take care of each other, and are repaid in ways that make everyone happier.

I look at families that are unsuccessful. Everyone looks after number one, and they gradually drift apart.

I know which kind of family I want. And I want my country to work the same way.
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.
John Lewis's profile photoFranklin Stone's profile photoJuan Clark-Lucero's profile photoAnil Seth's profile photo
I disagree when you are talking about business and families. Coase works. You do the best you can do and I do the best I can do. If it means collaboration-we collaborate. If it means I move my operations off shore to avoid taxes, I move my operations off shore. You are setting up straw men in you hypothesis. Companies, families can create a lot of joy for each other without penalizing themselves. Everyone can be self actualized.
It is the model of any business to minimize their taxes. Including mine and I presume yours. Why else would AMZ show such loses every quarter? How long can you run a business at or near a loss? Forever; at least, in this case, Apple reports profites wherever they move them too and doesn't bury them in non reported sales of the best selling goods or accounting tricks (that we know of).

Remember the reports from last year in the NYT about how the gaming industry operates nearly tax free? My business is in WA, one of the most onerous States that's actually hostile to small business and we pay our fair share. I'm certainly not going to pay more than that and instruct my accountant to do so, as any smart business owner would and does. I've got no guilt or personal reflections about it.

I see your points here and don't disagree, but I don't think this is a call for business to pay more taxes. Pay your share yes.
Our legislators are the simply the FINEST XD
This all assumes governments are the most effective way of "helping others"; that the government requires/deserves more money; that the government would shepherd these profits like a family would.

Don't get me wrong, I think Apple and other highly profitable companies should't egregiously flaunt the system; effectively breaking the law in the way they do.

But I also know the government will waste those funds better than anyone else.
Ultimately what they are saying, tax laws need to be completely rewritten to accomidate side stepping corporations like Apple.
+Charlie Kindel Tax codes ain't like the simple rules your learned in Kindergarten and it's ridiculous to say, "here tax me more" or even use the word Sidestepping. You minimize your taxes to increase profits - that's a lot different than moving a company offshore and burying your profits there to avoid most or all taxes. Anyone else in this thread running a small business in WA knows what I'm talking about, you're taxed every way they can.

I fall on they pay your share side of this debate, but not more for the sake of more in some help the government stance.
Tax is the price we pay for civilisation.
why should any one person pay more for the same government? I think taxes should be a flat rate for all at most if not a fixed amount no matter what you earn. You would not like it if food was priced as a percentage of what you earned. Government is less necessary then food. Remember, you will definitely die without food for long enough. You can survive very nicely without government.
Great thoughts, which I share completely. Also agree on the need to support richer posts (including inline links and photos). The worry has always been complexity, but I'll check out storify for some inspiration.
Seen it elsewhere. Lots. Why is this in my Google+ stream?
You speak of the right wing folk and conveniently forget that Apple is a particularly liberal minded company. Liberals stock holders love low taxes too.
You're in the wrong country if you want people to stop thinking of themselves.
I have my own business and look very carefully at ways I can maximize my income by using tax law.
I do not even remotely agree with how my country is run by the government and I will try my damned hardest not to keep subsidizing them.
I pray for the day that 'None of the above' becomes a box on the voting form.
Well said, Tim. Your personal history is a clear illustration of the question at hand.

Unfortunately, most of our country's leadership seem to disagree strongly with the proposition that corporations must share an obligation to support the common weal. See:
+Wilson Hines Actually, from what I can tell, Steve Jobs had libertarian leanings.

I completely agree that we all like lower taxes. But quite frankly, our taxes aren't that high, given what they buy us.

Could they be lower? Yes. Could we shrink the size of government? Yes.

But can we get anyone in Washington (since the Clinton-Gore effort anyway) to actually do anything about that?

Simply refusing to pay your share is not an effective strategy. All it means is that things fall apart.

We need a bottom-up rethinking of what we spend money on in government. That's a huge, decades-long effort. In the meantime, we have to pay the bills. And it's a heck of a lot better if we pay them all together. The alternative isn't pretty.
+Gareth Owen Exactly. I think any small business owner would agree with both of us; especially in Wa state from my perspective. Why the hit on Apple is a good question; then say Amazon or any other tech firm or as I mentioned above gaming. I get the populist opinion about taxes with the 1% not paying enough, but business is a different ball game all together.

I know in Wa the publishing industry gets tax breaks to say in business to buy hardware and goods related to making books.

I'm guessing O'reilly media benefits from tax breaks too? My company has and does.
I never really understood the rationale behind corporate taxes, corporates make money but that will ultimately flow to people who any way pay income tax, why this double taxation.
+Jeffrey Carter Whether the Coaseian Ceiling or Floor, we exploit what we merely conclude to be of value, but we defend what we love. But even business must have at least a narrow definition of love to survive, because while they are important, profits are not central. Profits are a side-effect of creating value and thereby making customers. It's a choice of what kind of world people want to live in.
+Tim O'Reilly Your heartfelt arguments actually highlight the problem with The Tax System. your mom helped you directly. In your analogy, your friends are directly involved in paying or not paying for each other.
The problem with Taxes are that they were invented in an undemocratic age where Tax was forced out of you at gunpoint. Govt has not made it voluntary or DIrect. So there is no way YOU can Directly help anyone. Governments are not our friends or family. They show no responsibility to our monies once they have collected it.
What we need is a NEW TAX SYSTEM. Appropriate for the Digital Age. here are the details :
+Tim O'Reilly agreed on the pay your share for sure, but tax breaks, incentives exist for a reason. My business benefited from the tax break for publishers in Wa -- I'm guessing your business does to, where you're located.
Wonderful analogy. I wish more people thought like you do, but unfortunately, we seem to be living in a time when looking out for number one is the status quo.
Being a libertarian leaning individual, I tend to want a tax code that is minimal in its complexity and puts all individuals and corporations on an equal footing - no loopholes, no sliding scales, no exemptions or deductions, no foolishness that requires a vast army of attorneys and accountants to take advantage of.

I also want a tax system that only supports necessary functions of government, and not the massive abuses of government funds we have seen in the current and several previous administrations. Cutting waste, fraud, and abuse along with a total revamping of our tax codes would probably balance our national budget in five years' time.
Tim, I would rather you "scale back". Scale back the government's wasteful spending. Stop salivating at the success of other people by sucking the blood out of them by the ever increasing taxation.
+Tim O'Reilly - the more I see this kind of clarity from you (consistently, it seems) the more encouraged I am. Thanks for sharing this perspective, with such clarity.
I am so happy to see those of influence, such as Tim, take leadership and say what should be said. Thank you!
+Jeff Sayre Horribly analogy.

Assume the entire affair would cost $100,000. The first person says "I'm getting a discount on the hotel so my share should be less." In this case the entire affair would now cost $95,000 and the person is off the hook for $5000.

Further, any savings are one for one, with the promised amounts of all parties accounted for. This is why it's a bad analogy. It's zero sum.

Taxes are not now, nor have they ever been zero sum.

The amount of taxes paid by Apple is a direct result of a corrupted, profit driven corporate system that has slowly infected the United States.

The idea of having an entire department devoted to avoiding taxes in order to gain profits is directly related to the absurd idea that corporations should first and formost be about the accumulation of wealth.
They should do away with taxes on businesses anyways. All businesses do is pass the cost on to the consumer. They collect the taxes, not pay them. All taxes ultimately fall on the consumer and to they extent you hide that fact from the populous, they are unable to determine their true tax burden.
And how high is the tax percentage for O'Reilly, the publishing company? Just curious.
Another major company avoiding paying their fair share.
Amazon do exactly the same in the UK by using Luxembourg for tax purposes
+Jerry Mitchell

Emphatic "no" to the idea that businesses pass through taxes to consumers.

In reality businesses spread taxation between these groups:

- profits for owners
- pay for workers
- prices for consumers
- prices towards suppliers
- existing hoards of cash

The proportion depends on the price rigidity of these groups. If the business is in a very competitive industry then the last thing they will do is to raise consumer prices. Monopolies and cartels on the other hand will raise consumer prices just fine.
+DL Byron - while a business trying to minimize taxes is a specific instance of a business minimizing costs, without the bigger picture, you are missing a key responsibility of a business. In the small (family or community) model, a business provides more efficient services to a community thru expertise and savings of scale. When a business moves from focus on it's expertise, and the service (marketplace niche) it can provide for it's customers, to focusing on profits as it's central objective, they are at the beginning of the end of their ability to serve. When, in a business-organizational analogy of unhealthy egoic activity, they then shift (again) to their own interests primarily - to maintaining the now central profit, without also factoring in the community - the customer, their market, they risk heading towards manipulation (price-fixing, cutting corners on safety, etc.). If they persist to survive to the detriment of the community they are in, the natural response (as in any relationship) is to either let them "die" within the relationship, or (if you really don't want to let a key family member "go-under") they get regulated. What Tim is talking about is being a responsible, balanced, valued member of a community / society, and what that contract entails (a balance of concerns: cost-cutting, with responsibility; profits while being of service; and so forth). Don't loose the big picture, for it is everything.
Funny how people can be patriotic, and even tribal when it comes to their country : but if we want to think of them as families, people get all upset and claim and start the nonsense of governments having a monopoly on violence/etc. That's like saying parents have a monopoly on violence, even in families with adult children.... It also isn't "their hard earned money" I think we should be concerned with, but the fact that when companies like Apple use legal/accounting trickery/loopholes it effectively means they are taking money out of the pockets of the rest of us. And if not our pockets, the pockets of our children and grandchildren as governments go further in debt because of this dishonesty.

I think the message here is that Apple is not only not a "think different" company that their devotees hold up so high, but they aren't even a respectable family member. Apple's open hostility towards the property rights of technology owners suggests they aren't on the "political right", so I'm surprised just how many on the right of the spectrum are so quick to defend them.
I'd attribute a lot of the problem to the complexity of the tax code, which both provides opportunities for this kind of nonsense and also punishes companies for trying move money freely between countries.

We punish American citizens as well as companies with Foreign Earned Income, and that leads to all kinds of behavior that is sub optimal for everyone. We don't need a flat tax, but if we had a tax code that could be consolidated down to a couple of pages I expect we could at least start to make progress on the inequalities.
+Manik Tyagi not sure about US but in AU corporate tax is more like a prepayment in lieu of income tax on dividends. The government wants some of it now, rather than letting the company just sit on it forever (many companies don't distribute dividends).

There's a credit on the company tax paid on the dividend. Tax is only paid once.
Take care of your family and friends with your own money. Start a community charity. Volunteer at a soup kitchen. Be all happy and joyful in your own contributions. Your churches only want 10%, I paid 12% just to the feds... that's real money folks. And what do I get for my money? Nothing of value other than The United States Military protecting my ass. I came from a very poor family and put myself through college. My wife did the same. Everyone, EVERYONE has the ability to make of their life what they choose. I don't look out only for myself, I look out for my family... pull up your socks and get to work folks. 
Corporate taxes are paid by the people that purchase their products. All this article proves is that people/corporations with enough money can avoid taxes, legally. The only reliable way to collect taxes is when a product is consumed (sales tax) or when it crosses international borders (tariff). I say this because, despite income tax rates in the US varying between 25 and 90% for the wealthy over the last century, their effective tax rate has stayed in the same range.

In a developed country like the United States, despite recent increases in disparity, wealth is concentrated in the middle class. The way to spend more and pay for it is higher taxes on the middle. That's why the $250,000 barrier for being rich is so important. If you raise rates on the rich, $250K plus, they will pay the same effective rate they pay now through loopholes and lobbying congress. A generation from now, inflation will make that tax on the rich, a middle class tax. (see AMT)

There is a role for government, but it will not be funded by the rich or poor, but by the middle. Discover what burden the middle is willing to pay, and size government to fit that level of funding.
+Ingo Molnar so your saying the government does a better job at spending that money than all of those groups of people? Insane premise.
Nobody likes taxes but they are necessary. The more I learn about the more I support a flat tax rate without loopholes or breaks. A 20% tax rate would bring in more tax revenue from the wealthy and corporations (who average about 10%) while reducing the burden on middle class and low income individuals (who average 30%). A flat tax seems to be the only way to create a fair system the doesn't favor those with the means and time to fight paying their taxes.
I am sick and tired of the premise that entities, personal or corporate, who seek to keep as much of the money they have earned legally by availing themselves of whatever legal means, few as they may be, left to them, are stealing. As far as I'm concerned, It's the taxing body that is taking someone else's property. THAT is stealing.
We are not one happy family though, if you can't make it and want a bail out, you can get a loan but not an mammy loan. You have to pay for the privilege of being bailed out by paying back with interest. You talk about Apple and cite right wing anti tax and anti fairness. But the government wants to talk about anyone making 1 million or more. That's a big difference and is hurting many small businesses. Bill O'reilly has said that he payed around 35%. You know all you folks falling for this fair share thing are just being duped by a political ploy to turn this country socialist. You see what Apple did, they are smarter than the government and will always be ahead of the curve. Now just think if all companies did that. Or if all the big bad corporations moved over seas with their technology and left us to fend for ourselves, oh wait that's already happening.
Apple is profiting a lot from the tax money others pay, seeing how they are happily using a lot of (tax payed) courts across the USA for patent and design cases. #justsayin ;-)
I can see it now, a October surprise to get re-elected. They will bill Apple for all missed taxes and it will balance America's 16 Trillion dollar debt. With this action America will become a Socialist Nation and the World will follow, so kiss the future good bye.
+Ana Micheli

They only earned it legally once they paid all costs.

Taxation is how a 300 million people strong leading economy has historically evolved to finance its costs of operation.

If a business is not paying for those costs it is stealing in the same sense a tenant is stealing who is earning well but not paying the rent ...
+Tim O'Reilly Thanks for your analysis of this. As I read this article this morning, I thought about my law course in corporate taxation, and the limitations on what any government can do. Calls for a simple tax code or abolishing corporate taxes are easy to make, all one need do is ignore the national and international politics and the fluidity of intangible capital. One anecdote from the story ... Apple's boss was at a meeting of the municipality (Cupertino?) where they are based, and one council member expressed the opinion that they should pay more in taxes, as 'its fair share' of municipal costs due to its big operation and employee population. Apple's response? "If you don't want us here, we'll just leave ... would that help?"

Capital goes where it is treated best. That's a cold, hard fact. If the capital is treated best in Luxembourg, Eire or Holland, there is little the U.S. can do without taking hostages.

This is especially true when the capital is cash or intangible property like patents, trademarks and copyrights. That form of capital, in which high-tech and entertainment companies are rich, moves like wind from nation to nation, ready to shift at the slightest change in barometric pressure.
Following the family analogy, if the wealthy cousin earns100 times what the poor cousin earns, it would be fair to everybody that, say, the poor cousin's fee was $100 and the wealthy was $10000. Say that was %1 of their yearly income for both of them. The wealthy is paying a lot more than the poor one. However it would be unfair for the wealthy one to pay $50,000 and pay for half the party and have the poorest members pay nothing, because then what you would see the number of party crashers expand exponentially? Who wouldn't come to a free party? You would see the family grow instantaneously with a lot of freeloaders.

I think the fairest way is for everybody pay what they can afford in an equal manner. If the fee is %1 everybody pays 1% if there are people that cannot afford %1 of their yearly income, then you cut down on the party until it costs everybody 's cost is 0.5% and everybody can afford it!!!!!! But most importantly, it is not free for anybody!!

Back to taxes... you don't like tax avoidance (which is eveybody's duty to keep the government in check) I propose you simply say "Everybody pays not 45%, not 30%, not 20% but 5-10% of your gross income... No exceptions, no deductions, no nonsense.

do you know how many people small business, big corporations, would stop spending on the hazzle and lawyers to avoid taxes and how much capital would be repatriated to the U.S.?

Personally I prefer money going to the government as taxes than having it go to the lawyers. But the amount of money that goes to the government must be fair but not too much so that they waste it. governments are experts in waste!!! The best overseer for money are the people that spent their effort, and time making it!!
Joe Gutel
You act as if tax avoidance is a bad thing. The problem here is with your assumption that paying the government is a good thing. I agree with your metaphor at the end, but I don't buy into the assumption that government is the great mother of us all. There are many ways to help each other in America. I just don't get why government has to be the middle man.
+Al Johnson - your fear of "socialist" (as opposed to social) is just that: fear-based, and the opposite (perhaps more credible concern?) is corporate-dominated / influenced, and back to what (partly) drove people to flee and form this land. The dialog that is helpful is in the middle, with respect and cooperation. Polarization to either extreme (fearful position) is just a mechanism of divisiveness, and a distraction: it doesn't accomplish anything useful for us (maybe for some w/ an agenda, where divisiveness increases other's relative influence, power). Civility is about caring, listening, and having honest discourse - that's what works, and - heck - that's what we really at core should be focusing on defending. The whole point of taxation (not of governmental abuses, waste, etc., nor corporate reaction / dodging) is support of that core. That is the point: civil society.
Joe...go out and build you own highway to work. Go out and hire your own police force. Build your own army to protect yourself from aggressor countries.
Here's an idea cut LOADS of government programs instead of having all these entitlement schemes and we won't have this bloated fat bastard of a government demanding to be fed constantly.

For every small piece of legislation, there is a very real and very expensive apparatus that is created to enforce and regulate it. Offices, workers, fuel to power their vehicles so they can putter around and get into everyone's business...

A small government requires small taxes. More money to the private sectors. Less totalitarian intrusion into daily life.
Nice effort on using logic and morality on the anti-tax zealots. Probably should have gone bowling instead - more productive use of your time. :-)
+Tim O'Reilly you are be to commended for sharing this information. But other than the feel good aspects, what will happen is really the question isn't it?
No one in my family has ever imprisoned another of my family for failing to chip in for a party.

Governments that rule you and corporations for whom you work are not your family. Your family is your family, and I'd suggest caution when anyone tries to hijack your feelings for your family by using flawed analogies.
You won't think it is stealing when there is no police officer to come to your home to investigate when you want one, will you? Why? Because they had to downsize because of what? NO MONEY! Why? No body wanted to pay taxes!!
They minimized their taxes legally. If governments need more money, they need to change the rules on paying taxes.
+Ellen Wright I want to pay taxes. Governments are for infrastructure and I take infrastructure seriously.
I love the strawman rebuttals to reduced taxes and government by instantly going to the fundamental structures. "No police because you say we shouldn't pay taxes!" or "Hope you enjoy potholes for roads!" or "Your house will burn down without a fire department!"

Get real.

By gutting all the ridiculous, redundant, intrusive and unnecessary parts of federal government you'd have far better core departments because even THEY could function better without the tangled web of restrictions and regulations as well as having more income.
It isn't just Apple, it's every multi-national corporation. We do need to change the law, but of course the legislators listen to the money!
That's a great analogy +Tim O'Reilly and brings the point home. However, one can appreciate it only if thinks inclusively and considers the government and fellow-citizens as 'us'. If, however, 'us' is just our immediate circle of friends and nuclear family it is difficult to see the connection.
+Ingo Molnar

Taxation (parasitism) does not contribute to the evolution of anything. Taxes are, at best, an artificial cost, added arbitrarily by a third party for the benefit of "others". Income taxes did not exist in the US until the Civil War. Unfortunately, once an entitlement, no matter how small, is established its like a weed, or parasite. It multiplies and is virtually impossible to eradicate.
@Scott...Okay...what departments would you gut? I get so sick of hearing people like you just throw out the slogans without ever specifying what you think should be cut. So go to....what departments should be cut? If you have our opinion, you've obviously thought this through, correct?
Well, obviously, it would be police, fire and roads.
+Mike DeAngelis I think that's a bit unfair - every company that has the resources to do this does it.

This does show that we need some simpler, harder to get around, tax codes.
Yes I agree with Terry Campbell, an the first question Iwant to ask is what about microsoft? And what's the authors personal beef with apple I'm not critising his beef with apple becuase I TOTALLY AGREE WITH HIM, however I also understand him because the same can be said for companies like microsoft and verizon to corporations on my most hated list because of their status as monopolies which are supposed to be against Federal law right?
+Scott Henry Very well said. Scanning through the comments it does seem that any suggestion that taxes may be lower, or that Governments aren't Families, or that maybe spending is too high, is met with "Oh, you hate the police do you? Ride on any roads lately?"

I get that some people think Taxes should be higher, and that the Government is our family, and that spending should be higher why not just present those thoughts? Why hide behind the screaming straw man attacks?
-good for them. Its the laws we follow. Can't blame them for knowing it and using it. We are overtaxed anyway..
I feel like repeating myself, but more briefly than I posted earlier in the thread (read back if you want.)

The problem is corporation's singular pursuit of profit above all other motives. There is no reason for a hardware/software manufacturer to have an entire department dedicated to reducing taxes. Only a need to increase profit margins produces such departments. It doesn't make the product better, the client isn't served, and you can claim shareholders gain, but that's still self servering.

Profit motive drives tax reduction. Corporations need to be reengineered to remove pure profit motives.
+Ana Micheli

Building a great nation is not cheap and financing it via a profit sharing construct (also called "taxation") is not "parasitic" .

Apple knows this best, they charge a 30% mandatory tax of all revenues, for businesses using its "App Store" infrastructure.

Any business, if it opposes taxation altogether is free to switch its "Designed in California" logo for a "Designed in Somalia" one.
The overall corporate social contribution diminishes when jobs are sent overseas. When jobs are sent overseas to create a higher profit, the resulting loss of tax revenue (income tax from workers and corporate tax) shifts the burden of societies essentials (paying for infrastructure and essential social structure) to those of us who work here and pay our taxes here. Hardly an equitable situation.
I'm really tired of the half-measure gabbling from the Libertarians and the right-wing.

The basic right-wing premise is that taxation is illegal. Period. There is nothing in any of this mush of private-property-rights sloganeering that makes a 1% tax rate legitimate. Or even a 0.001% tax rate. The right wing says -- whether it collectively has the sense to understand what it is saying, or not -- that the government has no right to tax.

Underlying this is the premise that the government itself is illegitimate. That's the more debatable point. I have days that I almost agree with them. Almost.

But I don't think this is a reasoned position coming from the right. It seems to be mostly the South still grousing over losing the Civil War and being forced back into the Union they didn't want to be part of. Since the political shift of the South from Democratic to Republican, the Republican Party has become the safe haven for the secessionists. This is what really underlies the Libertarian party: States' Rights and secession, and the illegitimacy of the Federal government.

Here's the thing, guys. If the Federal government IS legitimate, then taxation is legitimate. And if taxation is legitimate, then "your hard earned money" IS NOT YOURS. At least, not all of it. How much of it IS yours? Whatever is left over after taxes. Whether that tax rate is 1% or 99%. This isn't rocket science.

If the Federal government is NOT legitimate, then making this taxation argument is just plain a stupid waste of time.

Fine. Go ahead and reduce taxes. Reduce them to zero. Have a nationwide tax revolt and withhold "your" money.

1) The Federal government will just borrow to pay its bills, until it goes bankrupt. Oops.

2) Since you can't trust the government to SPEND your money responsibly, where do you get the insane idea that it is going to CUT BACK responsibly? If you fire an alcoholic, do you think it's going to make him stop wasting money on alcohol so he can feed his kids? Look what the state governments have ALREADY done when they've run out of money. Oops.

3) You really WANT to fight another war with Texas? Or California? As soon as the Federal government is moved out of the way, the US will immediately Balkanize. Laugh at California all you want, they build a lot of the US military hardware. Hunger Games, here we come. Oops.

I think there's an inherent nihilism in the right-wing rhetoric, a kind of Four Horsemen subtext that fits well with their Christian Rapture theology. It isn't that cutting taxes will straighten up the Federal government -- it's that cutting taxes will destroy the Federal government. Bring the whole shebang down in ruins. A massive social Ctrl-Alt-Del.

Sorry guys. I won't be part of that gig.
The RICH 1% - IE CORPORATIONS both APPLE & BP making RECORD PROFITS but neither the government or the corporations will help me get a home so I am not homeless any more. Neither the government or corporations will help me find the PERL SCRIPT programming work I need since I am a DISABLED AMERICAN VETERAN. Senator Patty Murray & Maria cantwell give lip service to the VETERANS but the real problem is NOBODY will just do something to help. They always say theuy are going to and then go off and get pre occupied with the entanglement and bullshit of Washington. The American people are so tired of the BULLSHIT and somebody needs to make these friggin houses availalble. C'MON this has been going on since 2006 I have been trying. SOMEBODY PLEASE TELL SOMEBODY THAT CAN FUCKIN HELP - OTHERWISE YOU ARE JUST A LIAR TOO -
The thing is, Ana, the government does DO any building. Everything this country was, everything good that it still is was done by the private sector. All government does is take tax money and make itself bigger. And anything it tries to actually do it does so inefficiently as to be mind-boggling.
In fact it always boils down to a unique question for everybody: what kind of society do you want to build/live in?
I don't think taxation is illegal. I think it's immoral.
A free one, Nick. One of liberty, not one of no-cost entitlement.
Whatever happened to that moment of reflection, "Yes, we can. But should we?"
Whatever happened to Corporate Social Responsibility.

I believe businesses should pay taxes to the governments of countries where they do business and in that proportion. Luxembourg is not where that tax money belongs because the people there did not pay for the grossly overpriced iPhones & iPads.
+Scott Henry sounds good to me, but what about building something altogether instead of doing our little stuff in our little corner at a very small scale?
Taxation is theft. Don't blame the victim for avoiding the thief.
"Taxes immoral!?" Where would we get the funding for the workings of our society? When I was in an airplane partnership we all "taxed" ourselves at an agreed upon rate above and beyond operating and maintenance costs to account for desired upgrades, unforeseen problems, etc. Why should society as a whole be any different if we want to accomplish anything greater than what we can achieve as individuals?
Kean Damien, Very hard work in America is a past-time, something no one wants to do anymore, save a few. All anyone sees now is the end results: $$$$$$. Good grief, the company that Mark Ruckerberg (?) (the owner of Facebook kid) just bought for a ton of cash, was 18 months old. You can bet those 300 employees in that company busted their tales to get that company where it was, and they deserve every dime they get if they did it fair and square.
If only society behaved like a non-dysfunctional family. I'm afraid ours is not so highly evolved.
If considered together tax systems and strategies on making products could be very complicated. Imagine this (I use "imagine" because I am certain no one will really "consider" it): If Apple were to manufacture iPad 100% in the US, I would guess that 99% of those who now have an iPad might not have had one in the first place.
to the guy saying "Taxation is theft. Don't blame the victim for avoiding the thief." haha you're an idiot. please stop using all roads and parks immediately, thanks.

Also, to to Bern Shafter (?) (the owner of a Google+ account kid), yes, Mark Ruckerberg, that is definitely his name. I know you're busy posting wrong things about taxes, but it really only takes a second to look up the guy's name and makes you look less dumb.
I like when people scream they have enough of government when everything is allright and then scream equally they dont have enough of it when there is a big catastrophe or a problem far bigger than they can handle alone.

So it's not about the gov but what YOU do with it ...
My first response is "don't hate the player, hate the game." GE made a headlines a couple of years ago when it was revealed their corporate tax department was a profit center: it actually made money, through shrewd applications of the the tax code. All legal. Apple is doing the same thing.

A thought experiment: why does Apple come in for so much heat for the practices of it's subcontractors in China or perfectly legal tax strategies? They're not the only ones doing this: many US and multinational companies use the same labor pool. And the folks at ran a list of taxes paid by individuals in the wealthiest zip code in the US (in Manhattan, naturally) and the rates/percentages were much lower than most of us pay. To me, the true mark of success in America is when hiring a tax professional (not H&R Block) makes sense, when the amount you can get back covers the cost of hiring them.

It's obvious that there is no accountability in government, that our representatives don't have our interests or the interests of the nation in mind. Too many of them are motivated by personal power. More regular turnover of electeds, by informing voters and making it easier to challenge incumbents. And we spend too much of our industrial capital on arming the world to justify a global empire of military bases (700 bases in 150 countries).

As for the idea that that government doesn't do anything, that all the work is done by private sector workers, I could make the argument for any CEO who doesn't touch the products his company makes. Steve Jobs never built an iPhone. Steve Ballmer has no code in Windows 7. Would a private company build Hoover Dam, without which Las Vegas would be a wide spot in the road?
to quote Dick the Butcher of Shakespeare fame "First we will hang all the lawyers" (lol)
U.S. is the only industrial nation(as far as I know) without a national consumer tax such as Canada's VLF. So those who pay no taxes currently would pay something under a similar system. That would be more equitable.
By the way, taxes are still collected under threat of fines, and imprisonment.
My question is why is Apple being scrutinized? I would think that all international and domestic companies and individuals practice tax avoidance.
I, also take advantage of every tax break available to me as a citizen and tax payer.
+ Nicolas Dufour
Because taking what I have earned against my will and giving it to someone who has not earned it is stealing. For example; I just received in the mail an application for a government program that provides a free mobile phone with 250 free minutes/month to anyone who qualifies. To qualify you need to fill out the enclosed application and state that you are already receiving government assistance under one of eight listed federally funded programs. Additionally, the letter states that there is only one phone allowed per family. There were two applications in the envelope which was addressed "Resident".

As a tax payer, I don't want to pay for other peoples phone bills or bills of any kind; child-care, food, heating, housing,.......

I have no choice but to pay. If I don't, I go to jail.

Like I said. Immoral.
this is kind of obvious, every individual and business tries to reduce expenses, including tax expenses..
Kyle, taxation is never theft. It allows democracy to function. Avoiding taxes is criminal and shifts the burden to the middle and lower classes. Get an education.
This is why we need more space between business and government. Businesses don't fail or falter from tax increases; it becomes part of the cost of what they sell. That's why you heard so many business owners saying they were waiting to start hiring until they knew for sure what taxes were going to be. It didn't matter whether they went up or not; they were still hiring. They just don't like to do anything until they have the whole picture. What we have today is corporate tax evasion sanctioned by Congress. The fact that the Supreme Court has authorized massive spending by corporations to affect political outcomes has significantly reduced the efficacy of our system of checks and balances. We should be heading away from corporate interference in the political process; it does not bode well for the majority of citizens and, as the recent financial crises prove, is not necessarily good for business, either.
Any large corporation knows about and takes advantage of these tax breaks/loopholes. There's so many of them available, but only if you can afford it.
Ana.. you are right and that is exactly what jesus said!!!
+Jeffrey Carter Coase works in the world of the market, which is where people exchange real goods and services. But as +William Janeway makes clear in his upcoming book, Doing Capitalism, we live in an economy that is not a simple "market" economy. In fact, it's shaped by the interplay between three great forces, the market, the state, and financial capital. (The great insight of the book for me is that financial capital is not part of "the market" per se, but is an independent actor playing by different rules, in the same way that the state is.) A must read when it becomes available in a few months.
+Al Bee I was quoting someone above me, hence the quotes. How would what I typed after the quotes make any sense if I was agreeing with them?
+Scott Henry

Could not agree with you more! The government is inefficient. Let the private sector do it.
Is there something wrong with corporations only paying a 10% tax rate on profit?
Excellent! Thanks for posting this.
+Massa Sapiosexual I think that's a canard. A few people do it, but not many. I could have moved my company to Nevada (zero state tax) rather than California, but I didn't, because I like it here and am willing to pay for the privilege. The problem as I see it is people who want something but don't want to pay for it. Why move to a low-tax country where you couldn't really do business when you can just pretend you did, and get the benefits of having your business here, but the taxes as if you had your business somewhere else?

Oh, and by the way, the reason those are low-tax countries is often because they don't have to provide the infrastructure that would support real businesses. When all you need to claim you're doing business in a country is a PO Box, the infrastructure costs are pretty low. Any taxes and fees you can get are gravy.
They ONLY paid $3.3 BILLION dollars in taxes...people are seriously crying about them paying $3.3 BILLION dollars in taxes?
+Joe Gutel Precisely because stories like this shows what happens when shared infrastructure and social justice are left to corporations. If we want less government, we need to step up as individuals and companies and take on the responsibilities that we no longer want government to shoulder.

At bottom, government is a way of sharing costs for common projects that are too big for any individual. My whole "government as platform" analogy (google it) points out a good way for the boundary between government and private sector to be modified.
When someone or some company is able to find a legal way to avoid taxes, I say "More power to them"! I mean, whose fault is the unruly mess we call a tax code? It's OUR fault for electing corruptible people who claim to represent us.
+Scott Henry +Todd Sahba The problem is that America's infrastructure is worsening day by day, and is soon going to become a crisis as bridges left uninspected and unmaintained, as pipelines are not replaced within their age (and cause breakages, which damage and pollute rivers and land), as railroads continue to rust and eventually fall apart, and as city water mains (which are to be replaced every 25 years) break, failing to provide clean, fresh water to residents. Without proper maintenance--which has been IGNORED--the very underpinnings which make "civilized" and "developed" society possible. I'm sure you can find examples of these above instances.

But this is just a digression. The idea that many people come from is "if you don't want to pay taxes" -> "Why should you be entitled to the benefits?" I'm not one to judge, but Apple might not have even gotten its start back in the 1970s or 1980s without business tax cuts and services provided. The company's foundations, and the initial members may not have gotten their start if not for the developed country that they lived in. Would Apple be Apple today if Silicon Valley never existed? Probably not. Now that Apple--among other companies--have "made it", they don't feel any obligation to pay back.

If they want to leave, then they can pack up their campus, their company history, all of their employees, and leave America.

Also, lots of animosity towards socialism. I'm not sure people realize how it works. Lots of these comments seem baseless.

FWIW, I don't think Flattax would work. You just hide profits. "If worse comes to worst, the IRS can just base everything on property taxes–you can’t hide real estate in cyberspace." -Avi Halaby
I remember the first time I ever heard of a flat tax. It was when Forbes was running for president. It sounded like the best idea to me because it seemed fair and equitable. He was proposing a 10% flat tax. At the time most people said it was crazy. Now, other politicians who propose a flat tax are talking in the range of 20 to 23% and are, for the most part, being lauded as sane and fair.

I can't help but wonder if we had gone with a flat tax back then, would we be talking about 20-23% now.
Ana, are we to assume that you are also opting out of police and fire services? These are the kinds of things that require everyone to contribute who qualifies. Some qualify to receive assistance, others qualify to contribute, if they have the good fortune to not fit on the other list. So you want the above services, education, aid to the elderly and disabled, and medical care for children, to be handled by the private sector? Be prepared to have such things only if it is profitable for them to provide it for you. Are we back to a survival of the fittest mentality? That hardly seems like the path Jesus laid out for us, Michael.
It is referred to by the gutless politicians as Tax Equality.
They can evade billions of pounds of tax and I am fined for owing the UK tax of £600. Which means my debt is now £700, Vodafone have owed at least £6billion for many years and are being given time to pay.
+Scott Henry In theory you're right. But no one who argues as you do has come up with a credible account of what they'd cut to get to the promised land you talk about. Look at the Federal Budget, and figure out what you'd cut.

I'd personally take a big whack out of national defense (we spend more than the rest of the world combined), and yes, there is waste. But if you look at the actual numbers, and cut all discretionary programs by 25% - a phenomenally high number for waste - you'd still find that you hadn't closed the gap.

Are you ready to cut social security? (I would be. I'd have it means-tested, and I'd make sure that "cost of living" adjustments were real.) Are you ready to have a national healthcare system (which tons of evidence from around the world shows reduces costs)?

I think pensions for government workers are a disgrace, and I'd cut them to match private sector norms. (These days, that means mostly getting rid of them entirely. Government workers should have to save for their own retirement on the same basis as the rest of us. And that should start with Congress. The fact that they have their own healthcare and pension system, so that their interests are not the same as those of their constituents, is at the root of a great many problems in our society.) Eventually, these unfunded liabilities are going to bankrupt the nation.

I wish we didn't have so much national debt, and deplore that so much of our budget is going to paying interest on the excesses of the past, but there's no way out of that but to raise taxes, balance the budget, and at least stop the interest burden from increasing.
In 2012, we have to ask two questions:

1. Moral: should all corporate profit be taxed?
2. Pragmatic: can all corporate profit be taxed?

On the pragmatic side, rightly or wrongly, many countries (including Canada) have slashed their corporate tax rates and focused on a national consumption tax (such as VAT or GST/HST) to replace the revenue. The disadvantage of a national sales tax is that it's regressive -- the wealthier you are, the smaller a portion of your income it will represent -- but the advantage is that it actually works for bringing in tax revenue (if you buy something in Canada, the tax is collected in Canada, no matter what tax haven the corporate offices happen to be located in).

On the moral side, while this admittedly is a pretty weak argument, it is worth remembering that corporations are just a middle stage, and that corporate profit can still be eventually be taxed when it ends up going to a person (through dividends or capital gains). It's just that the shareholders might not happen to live in the same country as the company, so it could still be some other country that gets the tax revenue.
+Tim O'Reilly As to your thought experiment how about we suppose that we had no real input on whether to participate in this event, but some remote entity scheduled events and then demanded that we share the costs, wouldn't you take advantage of almost every tool to protect your property? As to your thoughts on family, government is NOT my family. Like you I have a wonderful supportive family. To borrow your analogy, suppose instead that some remote entity decided to take a large portion of your mother's life savings and give it to me to help me keep my business going, I doubt if she would have been so cheerful about the prospect. The fact that she, and in turn yourself, could choose whom to pass her generosity forward to made all the difference.
Typical corporate greed. Nothing new here. I wonder how quickly apple will start selling user data when #CISPA passes. #PROFIT #PROFIT #PROFIT...
Prefer you to start with GE... then work your way down the stack.
+James Grimes Let me give you an example from the private sector. "It's OK to spam. The internet lets you do it. It's legal. If they don't like it, they should change the way the internet works." As it is, there are a lot of people engaged in a constant battle against bad actors.

It's just the same with taxes. There are always people trying to game the system.

Now, imagine for a moment that the spammers had access to the people writing the anti-spam algorithms, and were able to give them cash to rewrite the rules in order to let their particular spam through. Would that be OK with you?

If not, how come it's OK for companies to make big donations to Congress to put new rules in place that let them get away with exploits that should be closed off once uncovered.

You have to realize that companies making tax exploits are a lot like spammers or virus writers. Just because you can get away with it doesn't make it right.

We should look at corporate tax avoidance in the same way that we look at security exploits. Loopholes should be closed as quickly as they are discovered. And we should consider the people who are constantly seeking them out and exploiting them as bad actors to be shunned.
Moral of the story: Selling, buying, financing and manufacturing should not be taxable events. They weren't during the majority of the U.S. existence thus far, until 1913. Taxes and income tax returns should be abolished. How to pay for it? Simple: fire all the bureaucrats, and stop having the government send out checks. Put all gov't property on eBay to pay off the debt.
If only we had a constant tax rate, no matter what company you work for, or how much you make. Then, nobody would have the right to complain about taxes.
Tim, Vey well said. And Jadyn, you have the choice to stop reading a post at any point.
+Kyle Polansky agree - complexity adds to cost and avoidance. Simple measure and single tax rate across entities and industries. In New Zealand most people don't file tax returns as no deductions, and mnothly electronic returns filed by employees give the IRD all the information it needs.
+Ana Micheli I understand. But in the same time, I hope you understand that a government is a tool in your hands. I don't like either when this kind of situation happens, so I'm trying at my scale to make it change, hoping others will do the same. I grew up in a society in which the social contract says that you should give a part of your income so that it can fund a common account to pay for common expenses (health, infrastructure, etc). You can walk away from it, and you will still be healed in case of a mortal danger for free. If I was trying the same at my scale alone, I won't succeed. Humans live together for millennia for a reason...
The only phone worth having is a landline.

Smartphones are a waste of silicon.
Tax avoidance? The only thing Apple hasn't tried to patent? :P
+Ana Micheli The problem is that the other side of your argument that taxation is immoral is that you'd have to claim that social programs such as road construction and disability payments for people who can't work are immoral. Is it immoral to let people who can't support themselves for legitimate reasons die just because we wouldn't want to immorally take money from people who earned it? We've seen that voluntary donations can't suffice for involuntary taxation because selfish people would never give their "hard-earned money" away, despite expecting to use public roads and public services. So what would your solution be as an alternative for taxation - because without an alternative, saying taxation is immoral is equivalent to saying "I'm okay with letting less fortunate people die because I like to keep the money I earned."
I agree whole-heartedly.

The problem is that corporations are more like the psychopaths in the family (even if they try not to be), and I'm not even sure they're in the family really. To borrow from your analogy, who's side of the family is Apple on anyway? They're telling different stories to different people! Or are they the uninvited guest, acting more like a zombie, crashing the party and eating and drinking way more than any fair share and doing it for free?

Somehow government has to be taken back to being a government of the people, for the people, and by the people. Corporations are not people in any way, shape, or form either -- somehow they have to have the personhood taken back out of them. Corporations as independent entities must not have direct influence on the laws of the real people. It's hard enough keeping the people profiting from corporations from having an undue and unjust affect on the officials elected to govern them.
That is honestly one of the most moronic analogies I've ever read in my life. Your country is one big family??? bahahahah give me a break. That totally made my day. I still can't stop laughing.
And with that, I'll conclude with a quote from one of my most inspirational figures, Sonny Corleone
"your country ain't your blood, you remember that"
...I might be American, but everything has a price, including my passport...and those Irish tax havens look pretty attractive.
and ps. Your dad sounds like a moron
no wayi it would ever cover the U.S. budget
this article is yet another reminder of where our economy is today.
And this is an excellent example of why the tax code needs to be made more straightforward, simple, and short, without regard to what side of the aisle you live on!
There is a difference between the billions the govt wants to collect from the rich and corporations and the trillions it is spending to support people who do nothing and have done nothing except collect a check from the government. It is one thing to collect disability because your leg got blown off in Afghanistan and another to collect it because you are morbidly obese or an alchoholic. As long as welfare programs are considered non-discretionary spending and can't be cut, but national defense is discretionary and is one of the first things to be cut, this country will continue to fall into becoming a third world country. Our founders understood that as soon as 50.1% of the people found out that they could vote themselves into "prosperity" on the backs of the other 49.99% this country was doomed.
I have a challenge for The Wise posting here: Find one single penny of taxation levied against a corporation which does not get passed on to the people who actually buy the product.

There is no such thing as "corporate" tax. Every single penny of tax collected from Apple computer or General Electric (or Warren Buffet, for that matter), is passed on to individual taxpayers in this country in the prices of the goods and/or services they sell.
+James Stilwell That's not true. It assumes that a company has unlimited power to pass on costs. In many cases, it simply reduces profit and perks.
Over on Twitter, Robert Hoffman (@rph65) wrote: "Very interesting, but question: Do you and your family pay lowest tax legally allowed or forego eligible tax breaks to help US?"

I replied, "I think you miss the distinction between 'legally allowed' and 'will probably be outlawed but we can get away with it for now.'"

That's an important point here. Companies push the envelope with aggressive tax strategies. Eventually, some of them get caught. Others get legalized through lobbying. And our tax code becomes progressively less effective and more unfair.
There is more burden placed on 'the poor' in the United States by taxing corporations than by our current income tax system.

When a homeless person buys a sandwich, he/she pays all the taxes levied against the corporation or company selling the sandwich (plus compliance costs). How exactly do higher corporate taxes help this individual?
+Paul Evans so we have to be grateful in being over-taxed and screwed day in day out by the super rich....a nice idea, but in reality its a delusion unless the rich get removed...and then the next lot will be straight in their place.
+James Stilwell ... You seriously need to look at history and taxation. When the rich and the corporation are taxed less, they horde more and off shore more. When they have tax rates that are higher, they tend to invest back into the company or create more companies so that they can avoid the higher tax rates.

It is easy to Google and find the historical relationship between taxes, employment, GDP, debt, deficit, etc. The repub/libertarian way does not work.
+Kevin M How does your point relate to my question? I'm still looking for the single penny which was ever taxed from a corporation which didn't come out of a consumer's pocket - Under any system of government.
+David Megginson One of the flaws in the argument that corporate profits just flow through to the shareholders and can be taxed there is that the wealthy have great tax-avoidance legal hackers too, and there are all kinds of loopholes available to them that aren't available to normal people. (If you own huge assets, you can simply "borrow" against them, live on loans and pay no tax, because it's not considered "income." Lots of very wealthy people do this.)
+Tim O'Reilly Their power to pass on costs is only limited by how much consumers are willing to pay for their product.
+Martin Vaughan The problem with your assertions regarding defense spending vs. welfare is that the US has always spent a higher percentage of the GDP on "defense" than on welfare, even if that so-called defense involves bombing civilians in other countries who didn't hate America until we killed their friends and family members. Not that all people on welfare are lazy, but even if they all were, I'd rather give a dollar to a self-destructive alcoholic than a killing machine that only makes us less safe.
B Lloyd
The U. S. government and representatives could never overcome the lobbyist to achieve such a goal of TAX fairness. The lobby money would kill this before it starts. How could you go into a salaried position not being a millionaire and become one? After some years of lobby money and tax cheating and bad campaign finance laws MILLIONS. I am rich I do not have to look out for the people I represent. Alas an America that has gone astray. Who can right the ship not the moneyed few! The masses VOTE them out as fast as you can. It is not about Democrats of Republicans it is about the whole country. Who makes up the country? THE PEOPLE !!!!!!!!!!!!
Jeff Theisen, So, tell me, which politicians should we vote for that are going to change it?
Not to sound mean, but I look upon it from an intellectual point of view. Your views +Tim O'Reilly echo my own in regard to each needing to pay their fair share. I'm afraid I look very dimly upon those who argue against this. They're called "libertarians", etc. but I generally only hear "big meanie" whenever I hear that word :)
if "corporations are people too, my friend" (as Mitt Romney puts it), then why shouldn't they pay taxes on their worldwide income, as normal people have to?
Under what other system will professional Masons and Plumbers (or any number of other trades which are done by 'peasants' elsewhere) own their own houses and corporations? So our system allows exceptional success to a few people; it also allows people who a barely literate to own homes which would be considered palatial to a majority of the world's population living in their utopias. - I can live with that.
speaking as a right wing rhetorician, this is slightly a straw man that actually proves the main point. Excessive government complication amounts to a subsidy to corporations and rich folks who can rent politicians by the carload, and in a multinational environment corporations take advantage of every marginal benefit they can.
Taxing corps just hides the taxes from the worker or customer who actually pays it. Taxing the corp does not shift the tax to the corp. The corp just shuffles it and hides the real rate of tax the citizen pays from the voter.
+Arif Shurdho I don't think it's a reasonable debate. What Apple is doing is wrong, as is most of Corporate America's aggressive tax evasion. I loved that the New York Times called them out on it. That's what we used to expect from "the Fourth Estate."
> Somewhere along the line, you realize that you just can't afford the great party that you'd all had your hearts set on.

This "party" is the government, and it really isn't that great, and not everyone wants it. Some of us just want a coffee table to discuss things at, and there's nothing wrong with that.

If you're trying to throw a big great party with all the problems you described, why are you even trying to throw it? It's like an admission that it shouldn't even be happening.
Bo Tian
I agree that the current system is unfair, but the solution should be to lower everyone's tax burden to 9.8% instead of increasing Apple's tax rate.
+J C Lawrence You can have freedom or you can have security, you can't have both.

I prefer freedom, but that's just me.

I wouldn't mind taxes if I got to choose what it was used on. But our government is pretty dead set on the concept of "Give us your money and don't ask questions."

Since I don't get to choose, why should I feel obligated?
+Tim O'Reilly Exactly how much of O'Reilly Media's ~30% tax rate came from cutting "benefits and perks" and how much got passed on in the fees you charge your advertisers? How much of the overhead incurred by accountants and lawyers necessary to comply with those taxes and regulations? What could you, personally have done with that money to make your world a better place? How many employees could you have hired?
I agree with you +Tim O'Reilly - I posted this article a few ours earlier (I'm in the Eastern time zone). I think that we may be able to change a few corporations by using their tax policies as part of our decision making when selecting a product to buy. Apps and services that help consumer buy products could include tax information (e.g., latest tax rate) alongside product features. And we can track the effect of change to sales over time, if there is any such changes. There are differentiating opportunities here in this market.

I also see this as part of the 99% movement because large corporations are run but the 1% of the 1%, who are actually running the corporations for their own wallet or gold supply. Extreme tax avoidance is part of the same problem.

Here's what I wrote at 9:10 Eastern: "Large corporations can legally avoid taxes much better than a salaried employee can - another example of how the 99% of citizens are almost exclusively supporting government services/platforms. Buying a product is much like voting for a political party and politician. We need to get information on how the corporation/party/politician is really behaving, and look past the advertising, before we vote or buy the product. Taking care of which product we buy can have a more direct influence on the quality of services from governments. If we can buy products from corporations that have more generous tax policies then we will get better funded services and platforms, almost independently of which party or politician is in office."
Here in the UK The Telegraph has a piece about vodaphone who negotiated a payment 1.25bn GBP with claims that the company was 'let off' 8bn as a result of a deal! They talk of 'sweetheart deals' with big buisness including goldman sachs,deals that the HMRC had tried to conceal!
VAT's are used in 'Social Democracies' so that the governments in power can force those who are net economic producers to collect taxes for them while allowing the same governments to demagogue those producers for charging their consumers high prices. It's a great system for governments who like to have their cake and eat it, too. High ranking members of ruling parties in those countries live quite comfortably even while wrecking the economies they 'manage'. Is that where we'd like to go here?
If we are supposed to think of general taxation and the overall amount of government spending as reasonably justified on the grounds that these things were the outcome of a democratic process which "the people" (somewhat indirectly) agreed on, doesn't the same logic suggest that the loopholes are similarly reasonable and justified?

Loopholes aren't a bug in an otherwise perfect system; they are part of the negotiating process that produces laws. If it weren't for loopholes, legislators wouldn't be able to find support for tax rates as high as they are. The loopholes are there for a reason. The loopholes are part of the exact same "social contract" that produced the taxes. If you favor higher taxes, argue for that. If you think some specific rule that's being used as a loophole no longer serves the purpose it once did, argue for modifying it, But arguing against generic "loopholes" is about as useless as arguing against generic "wasteful spending".

TL;DR: Loopholes aren't mistakes; following the letter of the law isn't immoral.
man i am new i a weird plzsome one help me
+Glen Raphael Point taken. Unless the laws in question are themselves immoral - which is the point both sides of the tax argument attempt to make.
+Roger Weeks wrote "Countries with VAT are broke. See the UK or the whole EU for examples."

Normally, I try to be diplomatic with my responses, since opinions can reasonably differ, but Mr. Weeks's claim is demonstrably incorrect.

Observation 1: The 14 countries with S&P AAA credit ratings -- in other words, the healthiest economies in the world -- are Hong Kong, Germany, Denmark, Finland, Australia, Canada, Norway, the Netherlands, Luxembourg, Liechtenstein, Singapore, Sweden, Switzerland, and the UK. (The US has a lower-tier AA+ rating, reflecting its weaker economy.)

Observation 2: 13 of the 14 AAA countries have a national VAT (sometimes called "GST" or "HST") -- the exception is Hong Kong.

Observation 1: 9 10 of the (non-broke) AAA contries are in Europe ( 7 8 of them in the EU) -- all 9 10 of these have VAT and better credit ratings than the US.
Speaking as a right wing libertarian nutjob, I can't help but point out a couple of problems with the party metaphor. In the first place, we're not talking about just one mandatory office party that everyone here in America is attending, including Apple. We're talking about a whole big world full of mandatory office parties -- mandatory office parties in China, Germany, England and Russia. Apple pays taxes to those countries in order to have the privilege of participating in those mandatory office parties. And why should American mandatory office partiers be able to force international corporations who are earning money outside of America to pay for mandatory office parties that only affect American mandatory office partiers?

Also, how is paying federal income tax a mandatory office party for all Americans, when only around 50% of us pay federal income tax? Seems like a boring and unfair mandatory office party to me.

Avoiding taxes is part of human nature. Maybe we ought to simply accept that, and realize we just aren't going to ever be able to afford the welfare state as well as a strong military. I realize that Democrats and big-government liberals are well intentioned -- hey, someone's life sucks, so we must use government to fix that as the first resort every time, right? -- But history shows us that more bureaucracy and Davis-Bacon scale wages can only do so much.

While we're at it, let's acknowledge that the rest of America is not my family. My family is my family, my friends are my friends. Joe Biden isn't my Father, Elena Kagan isn't my mother, and though I did spend 4 years of my life helping to guarantee your right to free speech in the Army, that doesn't mean want share my ice cream cone with you.

Thanks for the laugh.
Why should the government get the money? Obama and the rest just dole tax funds to friends and supporters. They waste the rest. When government starts proving they can manage my money and actually do some good, then I can support taxes. Until then.. GOOD FOR APPLE.
I don't believe that Apple wouldn't raise prices if corporate tax rates changed for it. And I don't believe you do either.
When corporations pay taxes, where does the money come from? Built into the price of goods and services is margin for taxes. What you are arguing for is raising the price of goods and services. Because the money doesn't appear out of thin air, and it doesn't punish corporations to raise taxes. You're effectively arguing for higher taxes on everyone who choses to buy anything from a corporation. You are arguing for increasing taxes for everyone, rich or poor.
You likened this to a family where some people don't want to pay their fair share. But that is not a fair analogy. You coyly imply that everyone will be charged an equal amount, when our tax code is designed to be unfair. We want to encourage home ownership, by offering a tax deduction. We want to encourage charity, so that is deductible. We want to shift the burden of society to childless couples, so we offer a deduction for dependents. We all know this is in the income tax code.
As the article says, governments are seeing tax revenues lost from companies fleeing punitive tax rates. But vilifying people for responding to the economic realities is silly.
So remarkably silly that I wonder if you believe this or if you are trolling an offensive idea in order to get a lot of comments.
Kudos Mr. Reilly, you suckered me real good.
When a company moves manufacturing abroad to save on costs, it amounts to much the same thing. Less of that particular companies profit and running costs gets to or spent in the country from where they came, either through tax or wages or buying stuff from other companies that would of relied on them remaining in that country. I think it is all out of order. There is a guy in America (and I know there are others) a billionaire who has kept his manufacturing in the USA as he has a workforce that helped build his companies and rely on them for their families affording to simply live. He says "who is he to take that away to line his own pockets". More power to the likes of him. Mr Rich he is called, funnily enough. Robbert Rich. It is a shame more don't have his view on social justice.
+David Megginson What would the credit rating of those European VAT countries be if they'd had to win (or lose) the Cold War on their own defense budgets? Those economic numbers are unsustainable without the (I'm guessing here) 4 Brigades our non VAT system maintains to protect their physical and economic security. Know what 4 Brigades armor and infantry costs to maintain in the field? Introduce proportional defense spending into their economic numbers and the picture changes drastically.
We should reduce or eliminate corporate income tax, which is a form of double taxation, to encourage business growth. The net effect will be increased revenues to the government, increased employment, and overall prosperity.
There is a Fair solution to this,its called the Fair Tax
+Mack Leknife wrote "I don't believe that Apple wouldn't raise prices if corporate tax rates changed for it. And I don't believe you do either."

If Apple could sell iPhones for $1,000, they'd already be doing so, regardless of their corporate tax rate -- what company would turn down higher profit? The reason Apple can't price that much higher is that they're in a competitive market, where they'll lose too many customers to Samsung and other Android manufacturers as their price point rises.

I suspect Apple will have to eat most of any rise in base costs, whether it comes from higher taxes, higher raw materials, or higher labour costs, unless the rise affects its competitors as well.
+Daniel Roberts How do we get to the Fair Tax without a) Repealing an amendment to the Constitution and b) ending up with the national sales tax in addition to our existing structure? Much as I like the Fair Tax, those questions must be answered effectively in order for it to gain any traction.

Under the current climate, opening up the Constitution for surgery is a terrifying prospect for a lot of people.
But if apple paid LESS in taxes they would have opened more soup kitchens and raised all their workers pay! You know, that trickle down BS they keep repeating...
+Tim Gray If Apple Computer (or any other public corporation) paid any more taxes than their legal minimum, they would be in violation of their legal obligations to their stockholders.

How many soup kitchens have you opened? How many employee salaries are you generating?

What gives anyone else the right to Apple stockholder's stuff? What gives anyone else the right to your stuff?
Just eliminate the federal tax on productivity 0on both personnal and corporate income.Tax only consumption,where by the wealthy consume at a higher rate than the middle class or poor nations.Societys cannot work the same way that blood families work.With the family bond ,there is no coercion of state into the families business.Governments make for lousy parents,husbands,fathers and wives,and if you dont believe me,then take a look at the welfare state.Eliminate any and all forms of corporate welfare as well,from agricultural subsides like price supports for sugarto government picking the winners and losers buy subsidizing alternative fuelsistead of allowing the private venture capitalist and private markets who have a far better grasp of market buy and sell signals.No more bailouts for investment banks or auto companies that want my tax dollar to subsidize what my consumer dollars will not.
+James Stilwell wrote "What would the credit rating of those European VAT countries be if they'd had to win (or lose) the Cold War on their own defense budgets?"

Since the Cold War ended 23 years ago, it's hard to see how that could explain their current economic states.

In any case, Sweden, Finland, Switzerland, and Singapore were neutral during the Cold War. While the UK allowed US forces use of its bases, it took care of its own defense costs and those of Hong Kong. Modern Germany consists of both the West and the East, so the US and former USSR share credit for shouldering its defense costs during the Cold War. Canada and Australia did a lot of defense spending of their own, but it's probably fair to say that they benefited to some extent from US protection (though they also weren't in immediate danger from the East bloc). So really, I guess the only clear beneficiaries in the list are Norway, Denmark, Luxembourg and Liechtenstein. Still, that's a long time ago for it still to be affecting current budgets.
+David Megginson "Hard to see how that could explain their current economic states"? It explains the fact that they exist as nation states at all. How hard have you looked at the issue?

How about the troops and material stationed there now (4 brigades or so)? Even that massive expenditure is dwarfed by our past commitments to European self determination and economic freedom.

Look at how much it is going to cost just to bring half our current strength in that region home. Look at how much it cost to get them as far as Rammstein in the first place - in money and in lives.

It's our big 'corporatocracy' and the freedom it allows which enabled us to foot that bill for them.
APPLE are very smart company ...they know how get around it..
I like how they showed walmart's tax rate of 24% I buy local as often as possible however Sam Walton has always been an icon for American ingenuity and entrepreneurial spirit. Glad to see his company still pays their share in taxes.
The problem with America is we want everything, but we want someone else to pay for it. We want clean streets, health care, drinking water, police, firefighters, good schools, smooth roads, etc, etc, etc.... When the bill comes, we complain about taxes. When we hear of cutting corners and tax hikes, then see this kind of bull-isht.... Yeah it's legal, but is it ethical?
Thanks for reminding me to figure out how to block people (like you) from Google+. I had thought getting of your tax and spend nonsense on Twitter was enough but Google+ found a way to dig you up.
+Mimi Mathieu Shareholders should not be allowed to 'dance on the graves of the peasants' any more than 'peasants' should be allowed to dance on theirs. Companies are just collections of people - no more, no less. If we don't defend the rights of others then who will defend ours in turn?
+Will Price Better to stand and debate well than to block :) Let those on the fence who happen to see this see your view and make their decision. That being said, I'm back to work.
Taxes are bullshit, nobody should have to pay them.
+James Stilwell wrote "How about the troops and material stationed there now (4 brigades or so)?"

That's Germany (and Italy, Romania, and Kosovo, which aren't in the AAA list). What about the other 9 European AAA countries, many of which were never even involved in the Cold War?

In any case, the original point was a response to a claim that the VAT had destroyed European economies. Clearly, whatever happened a quarter century ago, many European countries with VAT are doing relatively well today.
+David Megginson O.K., one more...
"Not involved in the Cold War?" How about the fact that they are not either a) Soviet satellite states (things are going so well for the former Soviet Republics, aren't they?) or b) fascist dictatorships?

And I've got news for you: When talking about a possible nuclear exchange circa 1970-1990, between the U.S.A. and the C.C.C.P., there isn't a single person alive then or alive now who didn't have an existential stake in how that turned out.

And to keep this on topic, the other side taxed their corporations (and 10's of millions of their 'regular' people) out of existence and where did it get them?
I for one am happy to pay #Apple 's #taxes for them. They produce such cool products--why should they be required to contribute to the society that makes this possible?
Corporations and their employees and shareholders are taxed so many times by the government. Its insane to only focus on this one branch of taxes when there are so many other levels of taxes on top of this.
I have issues with those who try to avoid taxe but I also have issues with Governments who think that those who earn more should pay a bigger percentage. Everyone should pay the same percentage (after a threshold - no point in punishing the poor for being poor any more than punishing the rich for earning).

10% of a million is bigger than 10% of a thousand - just in case anyone else hadn't noticed.
you know each individual person who profits from apple is taxed on a personal level (after the company itself already payed taxes). It's called income tax. If the ceo takes home 30 mil, he taxed on 30 mil. Your suggesting we need to do more double taxing.
+Timothy Rayner , you should read up on the diminishing marginal utility of the dollar. A 10% tax rate on a million is not equivalent to 10% of a thousand.
Who really pays Apples taxes anyway? The consumer, right? If Apple is taxed more, it simply raises it prices to account for the loss. And remember Apple employees are tax payers as well. We need more tax payers not more taxes. Just a thought!
I love the lame argument that consumers will ultimately pay more. So, no business should pay taxes and we are all better off? I think not. Every one must carry their weight in this society including Apple. Taxes are not the enemy.
Jesus said take care of the sick and poor. Jesus said it was hard for the rich to enter heaven. The rich man in hell lifted up his eyes and wanted Lazarus go and warn his family. The good Smaritarin helped the person on the side of the road while others passed by. The story of Ruth and how was left out for poor to gather. The ignorant money loving prosper Bible loving Republicans miss the message of taking care of people and think if only $$$ which the bible says is the root of evil!! They ignore that the Bible says not to lay up our treasures on earth!!! So the Democratic party is closer on these types of issues that Republicans ignore. A church pantry can not do as much help as government programs do. 
I say this as a person whose brother is a pastor of an Assembly of God church. It does not matter if the people seeking food etc from his church smoke drink whatever if they need food from the pantry it is given out. Yes some people abuse just as they abuse government programs but most are not!!!
When someone claims benefits from the State they are a scrounger; when I suggest the rich should pay more taxes I am a socialist; but when corporations do everything they can to minimize their contribution to state costs they are being good corporate citizens. Shakespeare had it right: the times are out of joint.
Yeah and you can add Buffet to the list of major tax evaders... what a hypocrite!
Well there's 2 sides to this! On one side I believe that companies should pay their taxes, and I personally own a business myself...But the other side is that the companies, large or small should be taxed equally and fairly across the board. As for companies moving overseas, a lot of it has nothing to do with taxes exactly, it's more to do with the feds imposing minimum wage requirements and ridiculous regulations!
Wow. Is there such a thing as a libertarian who understands history, sociology and economics minus their ideological spin on the situation? Based on the comments here I'd have to say no. There is no understanding of price elasticity and the limits it places on the ability of corporations to pass all taxes on to the customer. There is no understanding the concept of the necessity of social infrastructure to help enforce contract law as a condition for a successful business environment. There is also apparently no understanding of why sufficient physical infrastructure as a government responsibility contributes to a successful economy. Then there is the ongoing inability on the part of many to understand marginal utility and what it means to the income and taxation of the rich versus the poor. There is no understanding that those who work for the government are people, just as real and deserving of consideration as anyone else. There is also no understanding that besides taxation, another cost that businesses work as hard as possible to avoid is that involved in employing people. If you wipe out the taxes they pay that will not change and magically lead to full employment because of the private sector. The private sector does not consider the production of jobs to be their responsibility and couldn't care less if they ever hired another human being if they could still make a profit. BTW, those who speak of tax avoidance for the average person being no different than that of corporations have apparently forgotten that the average citizen can't afford a corps of lobbyists to rig the rules.
The only thing that you are missing is that the federal government is spending our money on garbage and if they were to come up with a decent budget people would not mind paying the taxes so much. Why not make them balance the budget before agreeing to give them any more money? 
Exactly right Tim! A lower tax, flat tax rate and all of those taxes would be here in America. Since we have such a high corporate tax rate Apple has gone across the pond. In other countries that want there business they will be more competitive to get it.
There is a sustainable level of cost for everything. If it becomes too high, you look for ways to reduce costs. Income tax evasion should not be considered a legitimate option. Just as stealing materials and supplies should not be. Surely Apple and all the other "genius" organizations can come up with something better.
Nowhere in the Bible did Jesus say that people should bankrupt their country by providing for the entire populace, some of whom have devised ways to live off the system in the good old USA. He did say "the poor you will have with you always". The Bible says the "love of money is the root of evil". Unfortunately, that love is not restricted to only Republicans (who donate 5-7 times as much to charities as their fellow Congressional Democrats), who want to give money to the "poor", provided it's NOT THEIR MONEY! If the people of this country do not insist that Republicans and Democrats in Congress and the President resolve our fiscal issues (instead of pointing fingers at each other) then we will unfortunately see what it is like to be a third rate country. We cannot continue to live on money that we borrow to prove our compassion.
+Jim Satterfield What this "libertarian" (who doesn't claim to speak for anyone else) understands is that 'economic' and 'sociological' theory do not take precedence over individual freedom. I measure my standard of living by how much or how little intrusion into my daily life I'm required to suffer, not by whether or not "corporations" or "the state" or "my too rich neighbors" buy me a new refrigerator.

The less everyone else is in my wallet, the more freedom and opportunity I have to realize happiness as I see it. No government or individual can define that for me through scientific theory.
+Shane MacPhee You're ignoring the difference between income tax and capital gains tax. Steve Jobs was noted as having a nearly non-existent salary because he made his money from stock in the company, which gets taxed at a lower rate.
+Jim Satterfield And no one has yet provided me with an example of revenue seized from a private company through taxation not being ultimately paid by the consumers of that company's goods and services.
+Jim Satterfield I'm a libertarian and I quite understand history, sociology, and economics! I also understand that if you you impose unrealistic taxes on a company, 2 things are going to happen. One, said company is more than likely going to pass those taxes on to the consumer to alleviate the tax burden on themselves. Two, they are going to find ways to increase their profit margin, or at the minimum, maintain their current margin, however they can ie: lay-offs, moving overseas, tax write-offs, etc. Its smart business, we don't start business with the intentions of providing our products and services for free. What we really need is to get the feds fingers out of everything we do and give the power back to the states, make them stick to their 18 enumerated powers and go from there! There's many taxes, regulations, and social programs that are unconstitutional and unneeded!
Anyone here that can help another human being. Not advertising, or requesting money. Need some family attacked by someone rich.
+Tim O'Reilly your analogy has one serious flaw: what about those of us that dont want a BIG party? Whats wrong with meeting at a state funded park and everybody bringing a dish to share with the rest of the family? I want a federal government with no frills. Let folks keep their paycheck and then they can care for their own families as needed. You cannot tell me that the federal government can do a better job of taking care of my family's individual needs by stealing my money from me and doing with it as they see fit. I agree with Ron Paul's initial plan of reducing income taxes to a flat 10% in order to keep the neccessary programs in place, and then gradually fazing out the IRS out as we come up with better solutions. You cant seriously believe this current system is fair or productive. Can you?
Burr L
Politics is about power. Taxes reflect that power exercised of free will. If you consider America as a family, we are competing against China, Russia , etc. if we are to make our family strong, we need to outsmart and outthink our competitors. Politics should be directed toward that goal.

Instead, our politicians have divorced our family to get themselves reelected to promote their family, as if govt was a separate part of America. They provide many entitlements and credits to get this love and the results have put us in bankruptcy. Unfortunanatly, Mammy isn't going to help. Therefore to get back to our family values, we need govt to be the umpire, not a sponsor of our ball team. Fairness is what it's about, not providing everything to everybody, but assuring a level playing field. Taxes is one of those issues! Well stated.
So if we tax corps at a higher rate why would they not just move to a more favorable location? I hear Ireland has really bad unemployment. Maybe they should pack up and pay 0 and give Ireland some prosperity? Or move out of California the failed state??
Wow, Jim Satterfield, you must be an economist, so well versed.

The bottom line is that there will always be shyster business people and shyster politicians. They will always be found in bed together. They love threesomes with shyster union bosses. You can talk all the talk you want but until these are done away with, the rest of us will have to pay for their party in whatever form of payment they force us to make at the point of a gun. The worst part is that their demands are always couched in the form of helping the less fortunate or that they're doing us a favor.
Totally disagree with the logic, makes a nice you warm and fuzzy feeling of community...but, corp & business never pay taxes.... Even the ones they write a check are paid by proxy by the individuals purchasing goods and services.. so reality is you are advocating for higher priced goods and services which will hit the individual consumer and additionally politicians love this as they do not need to be accountable for the lack of efficiency... i.e corporation do not vote and when they raise prices.. you get the sad sob story of those bad corporations are raising prices again... but nothing linked back to the cost of government or the bad decisions of politicians.
Noel who did Jesus feed with the bread and fish? Current republican thought would be let them starve. Perhaps you forgot that Jesus paid his taxes. He also said give to caesar that which is Caesar. The Bible makes a point of helping those who are not wealthy in both the OT and NT! Let's use mitt for example he gives a lot in charity but look where it goes! The truth is a lot of Christian Republicans have gotten away from the Bible. A lot of what the Democratic Party is for can be seen in helping those less off. The Bible talks of a living and just wage but where is the justice with what workers make, CEO's and corporations? The first thing Republicans call for cuts is in programs that help the poor and the only thing Rich Republicans bound for Hell will not increase is taxes on the rich!!!!
he is not the responsible one, its the corporations, they don't care about what we do, they care about themselves and being selfish, no offense
Funny the problem is a system where you don't need a law degree to be elected and write the law. Do a poll of your local legislators and see how many of them have actually read the constitution? It is not possible and it is unrealistic to expect that such a system will produce anything but a failed product. By the way, It's not apple it's Apple shareholders, go democracy.
Tom M
"$3.3 billion, or a tax rate of about 9.8%"

Memo to glassy-eyed socialists everywhere: so you steal the whole $34 billion from Apple shareholders. This makes you feel better.

Now: what's different?
+Carl Friend well calling the mormon church charity is subjective since I don't see it as a Charity. Anyways he did'nt give it out of his own heart if your mormon you have to give to the church 10% they take it out of your paycheck. I call it garnishing your wages but not arguing that either (subjective) again. You ask how I know well I worked for a Mormon real state mortgage here in Las Vegas Called Silver State mortgage when I was hired I was asked if I was mormon, and if I was I had to sign up in giving 10% of my earnings. So this is why I dont see it as giving to charity if your made into giving with no choice.
Capitalism at work seeking all options to increase profits at everyone's expense.
+Carl Friend We don't run our republic according to "What Jesus would do"; the framers set this up so that you - as an individual - would have the freedom to run your life that way if you chose, or not.

In the gospel story, no one placed a gun to Jesus' head and forced him to help other people - he chose to do it. The inherent moral good is derived from the choice. If I give you food or money because you are hungry and it makes me feel good to do it, that is charity; if I do it because you're threatening to do me harm, that's robbery.

Taxation is the forced confiscation of our wealth under the threat of harm (physical or economic), it's not a choice we make. It is both necessary and evil.
Memo to Tom M: Apple gets to contribute to the infrastructure of the nation which their employees, retail operations and customers need and use.
I can also say that living in a rural area that most Christian republicans where I live and attend church are not wealthy but vote Republican because of abortion gay marriage and guns!! Let me use this as an example. My state of MD recently passed gay marriage. A few Sundays ago a member was passing out a petition for people to sign so that the people of the state could vote for gay marriage or not. These same people signing get tax breaks for their kids, Independence card, live in places where your rent is based on your income. These people are by no means wealthy and most work jobs paying 8-10 an hour or less. 
We are not a collective. Please stop with the emotional rationales. Also, your thought experiment fell short when u explain that a few pay more bc others dropped out. Thats not analagous. The truth is 1/2 the country doesnt even pay federal income tax. The wealthy pay a huge part of it.
+Carl Friend Starving the state of funding and power also limits the ability of those people to exert their will upon you. If you build it up, one day they'll have it, too.
- From Alabama :)
Mario, my brother being a pastor in the Assembly of God has to show what he makes and his wife. a part of what they make goes back into the district. Members who attend or others are not forced to give ten percent of what they make in tithes. He also gives back to the community. He has fundraisers for the school basketball team using his inflatable business. Raffle tickets are sold at home basketball games where people can win a chance to use the inflatables inside his building that he rents. 
Big thumbs up to Apple for taking the moral high ground on this one. It is the duty of every individual and corporation to pay their required taxes. And it is their moral duty to keep and use what is theirs and their stockholders, and pay as little tax as is legally required.
This country was set up for rich people first. First you had to have property to vote. Later came others who could vote as our nation got older. This capitalism that some are talking about cared nothing for how they treated workers kids women etc... This is why we had to have laws made. Each step of the way those with wealth fought against it. You claim trust business to do what is right but most do not. Business and the wealthy started the first great depression and paid a large part in this one. Wealth betting that the public had no knowledge about and later saying you don't have to worry about our inside bets.... Yet they get rewarded meanwhile if you or I robbed a bank we would go to prison when caught 
+James Stilwell Nice defense of ignorance, there. You want a specific instance of a corporation that didn't pass along all of their taxes to the consumer. Given that it is impossible to provide that, you stand triumphant, thinking you have proven something when in fact you haven't. A pathological hatred of government with absolutely no understanding of why it is just as necessary as any other part of our society contributes nothing. Taxation is necessary. It is not evil. If you want to see the outcome of your philosophy, wherein the state should have no real power I suggest a visit to Somalia, where the independent actors are far more powerful than the central government.
Btw I use Apple products and commenting using my IPhone 4s. I also use the new IPad. I also think changes need to be made and I think the republican idea of cutting back in one area while not increasing in another area is wrong ESP till we get the national debt down 
+Jim Satterfield I am asking for an example. While "absence of evidence is not evidence of absence", absence of evidence does beg the question.

I am ignorant; educate me.

Explain to me how Somalia is an example of a minimal government which protects individual liberty and defends its citizens from force and fraud?

Provide us with an example of the outcome of your philosophy, if you please.
+Jason Lanphear To be precise I said that none of the libertarians posting here were capable of understanding any of those fields without putting their own ideological spin on them. Your post simply proved my point. You claim an understanding and then proceed to do nothing but regurgitate ideological talking points.
+James Stilwell You can't be educated. You are not simply ignorant, but willfully ignorant, a condition that has no known cure. As I mentioned, the example you are asking for can't be provided because it would require 100% transparency on the part of corporations when it comes to how they determine pricing strategy. Since no corporation I am aware of provides that information your "request" can't be fulfilled. As far as why Somalia is an example of what your ideology would produce, it's really very simple. Any state as weakened as you want it to be would in fact collapse, lacking the power to enforce any of its laws. The absolute hatred you and the other libertarians posting here have for government is rather infectious and after you eliminate the ability of the government to enforce anything. It would not be capable of defending its citizens from force and fraud because you would strip it of any meaningful ability to stand up to anyone wealthy enough to hire private enforcers (Look at the murder of labor activists in the 19th and early 20th centuries for an example.) and they wouldn't have the resources to allow for meaningful investigation of fraud.
I'm also against the proposal that would hurt family business put forth by democrats and unions that would make it wrong for kids to help on a farm or other family business! I also know the paper work that small business go through since my brother has one. I also know that the price of gas has hurt me and has hurt my brother in his business also since he sets up and delivers during the spring summer and fall. But I fear republicans when they want to cut back and give more breaks to corporations and to the wealthy. Last all I hear is get out of the way of business and everything will be right when in fact it won't be
+Jim Satterfield Are you suggesting that we (as the ignorant) would be better off if we just turned our money (and the freedom it represents) over to those who do have a superior understanding of economic theory?

Lets see if we can come up with examples of times and places where that philosophy has been tried.
+Jim Satterfield My hatred is not for "government". My hatred is reserved for the human catastrophes which ensue when free people turn their destinies (and those of their neighbors) over to their state in the name of a scientific theory or two.

Also, I've not suggested that we strip away our government's ability to tax and spend and do its constitutionally defined job effectively. I only suggest that you are being duped by a government which forces "corporations" to collect taxes from you by proxy and then convinces you that the higher prices you end up paying are due to 'corporate' greed (corporations play along with this, to their shame).
+Jim Satterfield I do have a pretty good understanding of economics and sociology (given that I am intellectually stunted). Many of the theories you certainly know better than I are probably 'valid' and produce scientifically testable and provable results. I just tend to think that when weighed against freedom of action and freedom of conscience (whether mine or some CEO somewhere), freedom wins.
thank you for sharing your viewpoignant. :)
+James Stilwell Um, no you don't understand anything outside of the prism of your ideology. Yes, you do hate government, because your definition of freedom requires that it doesn't exist, at least in any form that would allow it to remain viable in the long run. You are an extremist. Barry Goldwater said that extremism in the defense of liberty is no vice. He was 100% wrong because people can't agree on a definition of liberty. Therefore when someone becomes an extremist in "defense" of his notion of liberty he will surely conflict with those who do not share his definition. You, and almost all libertarians, take a belief in individualism to an extreme that if actually implemented in today's world would cause the collapse of any nation so foolish as to try it.
+Jim Satterfield My definition: You're free to give away as much of your life's work and reward as you see fit, to whom you see fit; I will do the same.

My definition does not rule out yours; you, not having bothered to define what "liberty" means to you, have a couple of posts calling me names. Is that how you intend to win your strictly rationalist argument? Ad hominum attack?
The problem is not that Apple (or anyone else) tries to avoid paying taxes. The problem is that Apple (and everyone else) has to pay so many taxes in the first place. More taxes means more control for the government. When the government raises taxes (on any group), they increase their control over everybody. Therefore it is the responsibility of the governed to decrease the tax burden for anyone that they can. Us (consumers) versus them (large corporations) is not the issue; we can always buy from a competitor. The real issue is us (the people) versus them (the government). After all "a government big enough to give you everything you want is a government big enough to take from you everything you have".
Funny how apple is being criticized for doing a smart thing. If someone told you you can do something totally legal and pay less tax and you said no thanks. You are an idiot. If the federal tax was lower they wouldn't have to stash in other countries and if California had a lower tax they would keep their money And jobs there. Good for you apple
+James Stilwell Actually your definition requires that you live in a nation where there is no taxation and therefore no government. That is not this one. It is not going to be this one through any legitimate political means. Pointing out that you choose to interpret everything through your chosen ideology is not an ad hominem. You have posted more than enough to show that I am simply pointing out facts concerning your expressed opinion.
+George Butler For most modern corporations the only tax rate that would not result in lobbying for lower taxes and a search for tax havens would be zero.
+Jim Satterfield I've never said "no taxes" (in fact I referred to taxes as "necessary". What you're doing is known as "The Straw Man" fallacy (since we're bandying about fallacies now).

And you are correct: Your pointing out that 'I choose to interpret everything through (my) chosen ideology' is not an ad hominem attack - it's known as the "No True Scotsman", IIRC. :)

Are you going to call me the "N" word next?
Thomas, you are so sadly mistaken, you just like the hundreds and thousands of others have brought in to the hype of the republicans that companies,industries and individual millionaires pay a lot of taxes. Look and compare with companies all over the world (I mean the entire world) you will find that we have the lowest. What we do have is the most liberal tax laws which allow the above named to get away with the loop holes. The only ones frothing at that mouth to regain the white house are the republicans because they want to gut every single program and take it all for themselves. If you are to blind to see that then remember this ok, do not EVER say you are an American while you are allowing the republicans to gut all the Veterans Programs in place and weaken the laws to assist the Veterans coming home. Do not say you are an American while you allow the republicans to pass CISPA and other ones coming down the line. Do Not say you are American while you are allowing the republicans to gut all the gains made by women even while they are falling on their butts saying they are not. The same goes for education,healthcare and the rest. By the way healthcare is the biggest racket there is.
So the answer for doing away with taxes would be going back to Hamilton with Tariffs?
Since the Supreme Court has already ruled that corporations are people, why not just get rid of the corporate tax and tax corporations the same as people. That would mean that a US corporation would pay taxes whether it made money in the USA or another country...just like people do.
What pure liberal hogwash. It worked for me and my family so let's run the country the same way.
Thank Obama for Apples low tax rate. He gave tehm 100% deduction on depreciation.
The tax burden for everybody in the US is unsuportable- When companies flee the country in order to compete, they do so for survival.

Why does anybody think that the government deserves an income? They certainly don't earn it.
+Carl Friend I don't know that anyone here has suggested getting rid of all taxes (tariffs are a tax as well). There are a lot of people who seem to think that switching to a consumption based tax system (versus a production based tax system) would solve all The Problems.

I think it's tough to get there from here. Simplification seems somewhat doable (right now it costs McDonald's $14-15 dollars per hour to let an employee take home $7-8 and a lot of that difference "disappears" (I'm using that term loosely) into the paperwork and hassle of complying with the tax code as it stands now. Big companies spend billions each year just getting their paperwork done. That money goes to a system which has a vested interest in making itself more complex so we've ended up in a spiral.

This does nothing to a) lower corporate tax rates (if that's your thing) or b) help 'help the regular people'.
apple is notoriously left wing. so saying they avoided taxes kinda incriminates themselves.
Milton your are the best.
Daniel...I was being sarcastic. But does your comment apply to those who say that we should run the government like a business?
Thanks for the help by hoarding your billions....Apple sux.
+Carl Friend I should add that those McDonald's employees feel that bite into what they take home far more than McDonald's does (McDonald's does have better accountants - armies of them) to help it navigate the system and wrestle back a little more of its money. The employee, on the other hand "feels" that pinch sooner.

Punishing McDonald's does not address this; whereas fixing the system has some benefits to everyone without merely penalizing success for its own sake.
Joe, being left wing doesn't make them stupid. Like everyone else, they take the most advantageous deal they can. Just because your tax rate is low doesn't mean you voluntarily pour your profits into paying more. To expect that is both disingenuous and a grave misunderstanding of what "left wing" is.
The bigger the company the more benefit it has from the government's resources -- Especially their employees. They all live safely in america, and we fight to protect their rights more than individuals rights. They should be paying a flat fee -- It makes no sense for me to pay more in taxes percentage wise. Think about it. I can barely keep my head above water and my tax rate is almost 32% -- I can't even aford to pay a lobbyist to ensure my rights aren't eroded... Yet, the biggest corporations in the land, which could bear more burden because they do more business than I, pay less than a third of my tax rate. We need a flat tax rate.
+James Stilwell You also referred to taxes as evil. In reality rarely does any one want to tolerate the existence of that which they consider evil. I suggest you look up what the No True Scotsman fallacy again.
I find it strike that,... strange how so many seem to despise big business, but welcome big government, seems illogical to me... so you can call me 'SPOCK'.. ;)

I happen to not like either and believe the most efficient GOV/ business are some where in between big and small with a health dose of competition just to keep everyone honest and on their toes. Where there is no competition you have abuse and corruption.. no matter if it is gov or business, this is a fact based on the empirical data. I have worked for small and large and trust me the bigger they are the more inefficient they become, and without competition.. they all become woefully inefficient.. just my 2 cents.. but IMO seems more logical than the position by many that seem to think that somehow Apple has done a bad thing here by doing what the law that the various representatives you all voted for have allowed by LAW.

Seems to me many of you need to rethink your voting habits, and possibly look in the mirror at the start of the day tomorrow and make a change.. i.e I am the problem, I will start thinking and acting differently both at work and in life.. ie If i see someone with a need, 'I' take care of it instead of waiting on the government too, since the evidence seems to indicate they will not anyway.. ... and at least that is SPOCK's conclusion :)

In the end you will expect less of government and more of yourself... which is a good thing, unless you do not like to self improve. ;)
Surprised Apple isn't suing competitors for using their tax innovations without license.
I assume the Occupy movement will now begin protesting Apple, yes?
I am so glad the Times wrote this article..very thought provoking. Really liked your commentary too..Wondering what the way forward is.
A corporation's first priorities are to their customers, shareholders, and their employees. Country ranks somewhere down lower on the list. A government's first priorities should be country. Alas, our political system has subrogated their priorities to their political affiliation, and the campaign donors, and there is no organization (except for the armed services) who put the country first. If we cede all monetary and civil leadership to corporate america, we will cede our standing in the world as well.
I publicly despise Apple for selling over priced paperweights, but in this case they are just part of the problem. I did not read every comment (there are more then 300), but the few i did read were very interesting. I agree with +Kathleen Panov that the number one priorety of a company should be the share holders, customers, and employees. However,if a company wants to be known as American or Japanese or whatever, then they need to follow the rules set forth for companies in said country. +Massa Sapiosexual (love the name) other countries would love to have Apple, but that would open the door to the possibility of large Tariffs (if not now, then in the future). Apple for example, would either have to raise prices ( I personally don't see that as an option because they already charge people to much for a paper weight) or eat into their profits (which would possibly sink their stock price). Anyway, that is my two cents. Take it for what it is worth, i am by no means an expert.
Well i guess the world is not perfect
Everyone who can AFFORD to do this ...does it
State,Corporate,individual all need CASH
Cash is the King
How to draw a line that is fair to ALL ?........that is the question
By your analogy you should be on the hook for the same amount of money as apple. Regardless of your bank account. Therefore you owe the government 3.3 billion. Hope your check doesn't bounce
Tom M
+Tim O'Reilly "Note to G+ - do allow embedded graphics and multiple links! With a storify-like interface, you could do this super-easily"

Why should they?
It is totally immoral for Apple to do this as they are taking advantage of the US and World economic infrastructure, education, communication so they should be paying 25-30% of tax. This would solve some of the deficit problem. Huge Bug of the capitalistic process and then most of the tax burden is on the middle class!
The family analogy is spot on, and is what I use when I'm debating taxation with friends.
Tim - makes a lot of sense there in a family, not sure a company would feel the same way. Companies hardly consider their employees family let alone the tax burden of the nation.
It is interesting how Apple ensures that they collect all the 30% AppTax for the money flows through their products. No deductions allowed I assume
Yes, but as far as outsourcing goes, there comes a point where you have to ask whether or not it means something to you, that the person who produces the item of value is fairly remunerated for their efforts. Is there a fair trade. If you do not care, you buy the product regardless of how it is made. For me, the older I get, the more I want to know that the person who made the product or service is getting a fair deal, because that is how I would want to be treated.

There are pros and cons to all aspects of business methodology. You cannot argue against unions, and then complain that teachers do not make enough money at the same time. There are far too many variables, including quality of life, length of school year, difficulty of the labor to consider, etc. If it was not for unions, teachers would make far less than they currently do.
Blame the companies for lobbying to get such tax breaks, and the states that allow them. There was a similar report on Microsoft not paying any tax in Redmond despite its massive head offices there - and the local communities are suffering. I wonder what Nevada gets out of the deal...
biggest tax avoider, biggest polluter also, as they take advantage of dirty coal in North Carolina, Duke Energy.
Tax avoidance isn't tax evasion. Companies are more like cows than people, or more like machines; the have no morals, no patriotism, no emotion. And now they become eCows, jumping to other nations to avoid tax. The more milk (profit) they give the farmer (shareholders) the better. I see the real problem in legislators making laws for the benefit of the cows and not the people. May be the legislators are farmers!
I pose this question though.... why is it that we hold Apple as an American darling of a corporation when the keep their profits overseas and pay an effective tax rate of 9.8%, Amazon only pays 3.5% BTW, and we demonize oil companies and want them to pay even more when they pay an effective tax rate of over 41% already?
+Michael W. Moore SImple. Politics. Apple and Amazon are very popular companies. No one is looking at their environmental impact, lobbying activity, etc. Apple is a liberal darling. Amazon is politically neutral. Oil companies are in the crosshairs. They've been politically manipulated since the 50s, particularly since the Carter administration. They produce dirty and essential energy, lubricants, solvents, etc yet they are hated by liberals a destroyer of the environment. Maybe if they used a large, politically protected union they would be safer from Democrats. You know, like Detroit auto companies.
I posted the same take is that it's really unconscionable for Apple to be doing this in California right now as they struggle to support the civil infrastructure that Apple has directly benefited from. That and they are supposed to be different, right?
+Ken Ferry Probably because everyone loves Google and hates Apple. Look how many comments on their products appear in the thread.

+Tim O'Reilly If nothing else, the comments demonstrate how poorly the schools teach civics and American government these days. The highest rated comments all seem to reflect the "taxation is theft" mindset of the new entitled class who think their standard of living is a result of their own hard work. Considering how young that crowd is, I should be impressed. But since none of us choose where we are born or to what family, I can only hope they learn how lucky they are and how grateful they should be.
+Tim O'Reilly this is exactly what I was thinking when I heard the recent address about the Warren Buffet bill. It seems that people think the problem is that large corporation just aren't being taxed at all. I think the biggest disadvantage that the heavily taxed have these days is they have no way to "avoid taxes" as you say. Those that make under $50,000 have no investments or companies to hide their earnings in like the major corporations do. It's this creative tax deferral and avoidance that you speak of that has been exploited since the United States government starting taxing the rich and the poor.

The old adage, "The rich get richer" is because they know how to invest. Investing doesn't mean playing the stock market. It means buying or investing in products that are worth money that will grow over time. Not just that they know how to but they have the opportunity to because anything that will hold it's value most likely is going to be expensive to begin with.

That's my laymen opinion but having made six figures a year in the past and working my way up from making minimum wage I've seen the difference first hand in what opportunities the below median income is missing out on.
+James Stilwell ... it doesn't matter. The tax is a cost of doing biz, just like wages are, all cost are passed on and sometimes absorbed by just taking a little less in profit. It is part of the cost of being a part of a functional society that works for all.

This is about WE not ME.
+Kevin M "This is about WE not ME" sums up our differences. Some of us believe that "WE" is a collection of "ME"s and that "WE" are only as free as the "ME"s of which we are composed.
+Tim O'Reilly So what you're really advocating here is for corporations to set up programs whereby they pay taxes required, plus a "donation" of money not required to the federal bureaucracy?
What a pity to spoil what could have been an interesting comment with that snark at the end. You may have noticed (if not, look around) that there aren't as many small individual enterprises out there as there used to be because the larger enterprises have either snapped them up or driven them out of business. But then I suppose you will just tell me that rapacious expansion and the rule of profit is another "fact of life".

If publicly-traded companies were to take their corporate "personhood" seriously they would be held to the same ethical standards as people. Don't tell me that the profit motive can 't be regulated. If it is not, the powerless have a very grim future indeed, and one that is fast emerging. That's why Occupy needs technology products: you can't fight without weapons, and this is a battle of ideas.
+Steve Holden That's what they are using as weapons (iPhones and iPads)... I'm relieved... Having spoken to a few of those volk, I know they weren't bringing ideas to the battle of ideas. :)
Pat W
I'm not an Apple guy and I applaud Apple or any company which lowers their tax rate. I don't even like the iPhone or iPad, but love the open source environment of Android. If done legally, it seems that your company is plain jealous of their profits. It seems that you are on the same 'stupid' wavelength as the Buffet rule. I don't see you or Warren Buffet increasing your tax rate (15%) for your stock options. This approach of hating the rich and be like Jesus...oh please...people don't even read the Bible.It does say something about not to covet your neighbor's house.
Tax avoidance may be immoral but its also fundamentally short sighted - who is going to pay for all the intellectual capital that Apple will require going forward, let alone the physical infrastructure?
Tax avoidance/evasion/efficiency is a beggar thy neighbour approach - a fiscal scorched earth policy.
You are arguing that a company is unfairy taking those deductions and expenses allowed under the law?

Lobby the legislature including the state government that give tax holidays to employers to relocate then complain about the cost of providing schools for local children.

Lobby your federal government.
I am thrilled that Eric Cantor's defeat put the new tax holiday bill on ice. Given what a disaster the last tax holiday was for consumers (the ultra-rich got ultra-richer, and everyone else got poorer and lost jobs, infrastructure, public education, and preventative healthcare) it had absolutely no place in a democracy to begin with.

+David Pylyp is lobbying more effective than introducing shareholder resolutions to pay taxes like a citizen instead of a free rider?
Nice study. Thanks for share.
Add a comment...