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Apple CEO Tim Cook  (Source: rack.0.mshcdn.com)
The testimony has been prepared for Cook's appearance before the U.S. Senate tomorrow

Apple CEO Tim Cook's testimony on corporate tax laws has been made available on the Web just one day before he is expected to appear before the U.S. Senate.  

The PDF of Cook's statement aims to defend the way Apple pays taxes and offer suggestions for a revenue-neutral reform that brings foreign profits (made by U.S. companies) back to the U.S. 

The statement opens with an explanation of how Apple employs tens of thousands of U.S. citizens, and has paid "an extraordinary amount" of taxes in the U.S. According to the PDF, Apple paid nearly $6 billion in federal taxes in fiscal 2012 and the company expects to pay $7 billion in 2013.

Apple, a California company, employs tens of thousands of Americans, creates revolutionary products that improve the lives of tens of millions of Americans, and pays billions of dollars annually to the US Treasury in corporate income and payroll taxes. Apple’s shareholders – from individuals and institutions to pension funds and public employee retirement systems – have benefitted from the Company’s success through the appreciation of its stock price and generous dividends. Apple safeguards the capital entrusted to it by its shareholders with prudent management that reflects the Company’s extensive international operations. Apple complies fully with both the laws and spirit of the laws. And Apple pays all its required taxes, both in this country and abroad.

The testimony continues on to say that Apple doesn't use tax gimmicks and even describes (at length) the history of Apple. It says that Apple supports a simplification of the tax code, even if that leads to an increase in Apple’s overall corporate taxes. Apple went on to say that the current corporate tax system “applies industrial era concepts to a digital economy” and “undermines U.S. competitiveness."

The testimony goes into other specifics, such as Apple's how Apple accounts for U.S. profits, how research and developments costs are shared with its Irish subsidiary, etc. 

The Irish subsidiary is an important topic because of an attack from The New York Times last year. In April 2012, NYT accused Apple of dodging millions of dollars in taxes in California and 20 other U.S. states (and dodging billions of dollars in taxes worldwide) by routing its money through other locations. Even though Apple is based in Cupertino, California, it put an office in Reno, Nevada which allows Apple to escape California's 8.84 percent tax rate for Nevada's 0 percent. Apple has also sold digital content from low-tax countries anywhere around the world, and has used the "Double Irish With a Dutch Sandwich," which allows Apple to cut taxes by directing profits through low-cost Irish subsidiaries, the Netherlands and the Caribbean. 

What does Apple want? A tax system that is "revenue neutral, eliminates all tax expenditures, lowers tax rates and implements a reasonable tax on foreign earnings that allows free movement of capital back to the US."

The Senate also released a part of its investigation today, which claims that Apple’s system of subsidiaries has allowed it to dodge $44 billion in U.S. taxes over the last four years. But the Senate also mentioned that Apple did not break any U.S. laws.

Cook and CFO Peter Oppenheimer will appear in front of the U.S. Senate Permanent Subcommittee on Investigation at 9:30 a.m. EST on May 21, 2013. The hearing is titled "Offshore Profit Shifting and the U.S. Tax Code - Part 2" and concerns corporate tax laws and profit shifting. 

The entire PDF can be read here

Source: Apple



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this is the point
By kattanna on 5/21/2013 10:35:09 AM , Rating: 2
quote:
But the Senate also mentioned that Apple did not break any U.S. laws.


if they did not break any tax laws.. then no one can complain.

there is not a single person here who can honestly say that they decided to give more then the law requires when they filed their taxes, yet some expect "others" to do exactly that.

LOL




RE: this is the point
By retrospooty on 5/21/2013 12:04:51 PM , Rating: 2
This is true. I dont pay a penny more than I can get away with by law, and if I were Apple, or any other major company I would have done the same. You dont like the outcome congress? Fix the freegen tax codes. Oh, wait, your corporate overlords have it that way for a reason and wont let you? Bummer, stop wasting our time and get back to your regular day job of wasting our money. MUST you have both? LOL


"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997














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