Apple Among Few Tech Giants Paying ‘Fair’ Corporate Taxes [Report]

Apple Among Few Tech Giants Paying ‘Fair’ Corporate Taxes [Report]

Photo: kenteegardin www.SeniorLiving.org

Don’t look for the Occupy movement to picket Apple. The iPhone maker is among just a few tech companies paying their fair share of corporate taxes. According to a report released Thursday, Apple paid a 31 percent tax rate. By comparison, the likes of HP, Yahoo and Amazon.com appeared to have paid less than half the 35 percent corporate rate — or even lower.

The report by advocacy group Citizens for Tax Justice and nonpartisan Institute on Taxation and Economic Policy, checked the financial statements of 280 corporations on the Fortune 500 list. Of those, 30 paid no federal taxes over the previous three years, the groups charge. Among Silicon Valley, both Apple and Intel paid a 31 percent corporate tax, while Internet retail giant Amazon.com paid only a 7.9 percent tax rate on $1.8 billion in profits between 2008 to 2010.

The list was released amid spreading ‘Occupy’ demonstrations of anger at the wealth disparity in the U.S. and so-called ‘corporate greed’ seen as causing much of today’s economic troubles. Although the violence-tinged Occupy movement in Oakland, Calif. has drawn much public attention, the demonstrations have also made their way to the state’s Bay Area, home to many high-tech companies and startups.

In August, we reported Apple had joined a Washington, D.C. lobbying campaign to provide a “tax holiday” for large corporations that bring home cash stashed in overseas banks. The “WIN American Campaign” effort also attracted the likes of Google, Oracle and Cisco. The proposed 5-day tax holiday would “immediately inject up to $1 trillion into our economy and provide businesses with the security and certainty they need to help Americans get back to work,” according to the campaign’s website. In a bit of odd political bedfellows, Apple found itself aligned with a Republican-controlled U.S. House of Representatives and against President Barack Obama, who opposes the plan. During the 2008 election, Apple was among companies that gave $1.3 million to Obama’s election effort.

  • Gene

    Is there a link to this report? Every link in this article seems to be an ad.

  • Jordan Clay

    Amazon will do ANYTHING to cheat the tax system.  When California passes a law to make them pay, the basically said “no” and are now trying to make Californians vote to let them dodge taxes.

  • Neil Otto

    They also pay taxes on all internet purchases even when they don’t have to.

  • David Zager

    Yeah that horrible Amazon that tries to keep you from paying taxes on every purchase.

  • David Clark

    Funny how a 1040 is shown… Haha

  • Tim Meesseman

    Then they just build new warehouses in other states that allow it so they can get the new jobs in return. I’m in South Carolina, and they’re building one here soon for that very reason.

  • Ucjuicy

    Do not forget to mention that Apple is hoarding $54 billion outside the U.S., the whole reason they want a tax holiday. Or that these wonderful devices we use are made under horrible conditions, for cents on the dollar. Or that the rare earths needed to make them are more often than not stolen from African nations for blood on the dollar.

  • Tim Meesseman

    While it’s nice as a consumer, it hardly helps the bigger picture. If none of us paid any taxes, we’d be in far more serious trouble than we’re already in.

    Furthermore, don’t let Amazon fool you. They aren’t doing it to “keep you from having to pay taxes”. They’re doing it because it gives them a leg up on the competition. Those are two very different motives.

  • Hampus

    “Or that these wonderful devices we use are made under horrible
    conditions, for cents on the dollar. Or that the rare earths needed to
    make them are more often than not stolen from African nations for blood
    on the dollar.”

    And that’ also true for gadgets from other manufacturers.
    I have no real comment on your second sentence, but the first one, well, it’s a stage all countries go trough, it’s called industrialization, in UK/Europe it was during the 1700s, a few decades back we had stuff produced in Japan the same way they are in China now.

  • 1JKM

    don’t forget that every Foxconn employee has an option to return to his home village, to tend the pigs, and spend a life bent-over knee-deep in mud planting rice. No chains and whips involved here. But some union action in the PRC would be nice.

  • prof_peabody

    what a lot of ridiculous nonsense.  and not even funny to compensate.  

  • prof_peabody

    “… Or that these wonderful devices we use are made under horrible conditions, for cents on the dollar. Or that the rare earths needed to make them are more often than not stolen from African nations for blood on the dollar….” 

    This is 100% incorrect information.  You are just passing on the rumours you hear on the Internet without actually doing any research or having any real knowledge of what the conditions actually are.  

    The fact is, that Apple’s products are made in some of the fanciest, nicest factories in China under conditions that are every bit as good or better than those enjoyed by American or European factory workers.  There are many sweatshops in China, but they are not used by Apple.  There hasn’t in fact been any charges or any real evidence that there is *anything* wrong with the working conditions in those factories (beyond the minor things that happen at all factories), ever.  

    Also, the “rare earths” used in the manufacture of the products comes from China itself, not Africa.  China has the biggest deposits of those metals and uses them in it’s own manufacturing as well as distributes them world-wide.  You are thinking of “blood diamonds” perhaps.  

  • vig0

    California taxes are the worst. They have different tax rates for each COUNTY. Which is a nightmare for any business that deals with California. Regardless, Cal. is looking to get money from any source so they can keep allowing illegals and deadbeats to keep getting their welfare checks. So, they figure that they’ll try and take advantage of the “use” part of ‘Tax and Use’.

    The thing is, taxing Amazon more isn’t going to hurt Amazon. They’ll just pass on their expenses to the consumer. They’ll still make the same profits. It may cost Amazon more in accountant fee’s but the real loser in this is the consumer. There’s no “cheating” going on.

    Educate yourself Jordan and read past the headlines.

  • 1JKM

    fair enough, not v funny. Not nonsense though. Foxconn is not a hell hole, their workers have a choice. Unions are outlawed in PRC. I would probably prefer something made locally, but is that an option?

  • freediverx

    Amazon doesn’t do this for your benefit. They do this because collecting sales taxes would add to their operating costs and level the playing field with brick and mortar businesses.

  • vig0

    Put another layer of tin foil on that hat of yours, Tim.
    The “bigger picture” isn’t that companies aren’t paying their “Fair Share” of taxes, the big picture is that there is too much government spending.

    “They’re doing it because it gives them a leg up on the competition.”

    Isn’t that business 101? Do you know why businesses are created? Too make money. And in a capitalistic system, there is competition. To stay in business you need to be able to compete. If this is one way they can do it, they why is that bad? Who does it hurt? Amazon employ’s a hell of a lot of people and there are even more that are making money selling things through them as well. If they can save money by not paying as much in taxes, that means more people stay employed and more jobs can be created with the savings. They don’t take that money and fill up a swimming pool and swim around in it drinking silver dollar martini’s.

    Stop thinking that these big companies are the boogie man.

  • freediverx

    Can you please cite Apple competitors who manufacture their devices under better conditions and who pay factory workers high wages? If your rant is against the manufacture of modern electronics, then please be up front about it rather than misleadingly targeting a single company.

  • freediverx

    An iPhone made in the US would either cost 10X as much or would be stripped of half its features.

  • Cool K

    Actually, he is not talking about “blood diamonds.”  Coltan comes from the congo.  When you have a moment, watch this
    http://www.vice.com/vice-news/

  • Wayne_Luke

    Apple certifies that their rare earths do not come from conflict regions. Many companies do these days.

  • MoistPup

    That is a ridiculous statement.  It might be 50% more, a significant amount, but not 10x more.  

  • MoistPup

    I hate to point this out to you, because you are obviously so set in your thinking, but there are some people you do not want in the workplace.  Do you want to work beside “former lifelong wellfare recipient now just working to collect a paycheck and doesn’t give a shit about the quality of the job” or would you rather just have them sidelined living in a ghetto shit hole?  I know which I’d prefer.

  • Deocliciano Okssipin Vieira

    Apple manufactures in China because of Google and Microsoft.

    Apple competes directly with the cartels that sell Google and Microsoft products. And those cartels make their products mainly in asian countries.

    funny how people criticizes Apple because of FoxConn without asking WHY Apple is outsourcing.

    Microsoft and Google biz model kills the innovation urge.
    How many innovations DELL, Sony, or any other computer maker made compared with Apple in a decade regarding hardware, not to say OS?

    – They need NOT to, because being lazy suits them. So now most of them are struggling to make money. So they copy Apple research results in hardware.

  • catbusrider

    Ed, what about Google?

  • Deocliciano Okssipin Vieira

    Apple success is NOT that singular.
    It is JUST the old fashioned business model. 
    That is how USA used to be, making things that people buy.
    Germany still on doing it

    USA and now the european countries in debt ( look at Italy, its most famous cars are now owned by German companies, England also lost its car industry to Germany and India, Greece never had big industry of any kind, Portugal like IceLand killed their industries copying USA now collapsing biz model, a la Microsoft license and DO nothing! )

    Figure THIS:

    If Microsoft hadn’t licensed its OS and made its own hardware, Apple wouldn’t need to compete with the cartels it competes with now and many companies would have to make their own OS.

    Resulting in …
     * More competition, more rapid tech evolution.
     * Better prices …
     * … People will gain, even governments would save money, because public services would have to work with universities OS creations instead of buying from companies.

  • Deocliciano Okssipin Vieira

    Google and Microsoft are NOT USA companies anymore, both are worldCompanies.

    Both help make more money outside USA.

  • catbusrider

    Uh, so is Apple. http://www.loopinsight.com/201
    63% of revenues from International.
    What are Google and Microsoft’s percentages of revenues outside the US?

  • Deocliciano Okssipin Vieira

    You did not get it.

    Apple stands on its own feet, Microsoft and Google stands on others ( foreign companies ) shoulders to make biz.

    Apple competes NOT directly with Microsoft and Google!

  • Deocliciano Okssipin Vieira

    Really?


    quality of the job?
    ghetto shit hole?

    German companies pay taxes, French companies pay taxes, people with high income pay more taxes in France and Germany.
    French and Germans build much better cars ( Bugatti, M-Benz, BMW … ALL made in Europe! ) than USA car makers.
    German and French companies care about the well being of their countrymen, USA companies care NOT.

    Google and Microsoft makes Asian companies RICH, German and French companies competes with or in other cases buy shares of those Asian companies.

    Cheap mentality is killing USA!

  • Jay Alan Goodwin

    I’m calling bullshit. Comparably-priced German cars are no better than their American or Japanese counterparts. When they charge you 10,000 euro more for the same class of car and you pay for whipers on the headlights and “hand-alignment’ of the hood it doesn’t seem like such a big value

    You’re just letting your European pride (and possible arrogance) get the best of you. Have you worked for an American auto company? I think the only real difference is that a German can drink a beer on their lunch break. American auto workers are not treated without care. They all have unions.

    Germany’s reputation for well-made products is deserved. Germans take much pride in their work and have attention to detail often lacking with others. They also charge you a shitload more for that detail. On the negative side they also whore out that reputation to companies outside of DE by letting them import assembled products into DE and stamping “Germany” on them. This is misleading to consumers and deceptively done for profit. They also outsource just as much assembly and labor as US and Japan now…while still charging “Fabrik in Deutschland” prices.

    …French cars. Are you kidding me?? NOBODY cares about French cars but the French. You’ll find even more American cars in the Netherlands than French cars.

  • Deocliciano Okssipin Vieira

    Of course Germany outsource like Apple, and that is for them to compete better with Japanese/French companies.

    …you said…
    They also charge you a shitload more for that detail.

    …i say…
    Only for the detail you forget technology.
    Germans owns perhaps more than 90% of new tech for the automobile. Research cost money! Ask Apple!

    German car makers do biz like Apple, NO more, NO less.

    … you said…
    Comparably-priced German cars are no better than their American or Japanese counterparts.

    I say:
    Really?
    Not as fast as USA cars, but surely BETTER!

    ………

    German car makers  = Apple’s hardware/OS
    USA car makers = Windows’ vendors Cartel hardware/Microsoft OS.

  • JohnnyB

    Apple is hoarding $54 billion outside the U.S.?????   What a RIDICULOUS statement.  Apple earned the money, it is NOT hoarding. They have a right to keep the money where ever they want to…. What is ridiculous, for example, is if Apple makes 100 million in profit in a year in Germany and pays taxes on that profit to the German government and then if Apple decides to bring that money back to the U.S. then the U.S. government will charge them taxes on what they have already paid taxes on!  Obama… let the money come back to America tax free and be put to use here!

  • momo

    only Bavarians are allowed to drink beer on their lunch break, coz by Bavarian law beer is classified as basic food.

    Audi & BMW …

About the author

Ed SutherlandEd Sutherland is a veteran technology journalist who first heard of Apple when they grew on trees, Yahoo was run out of a Stanford dorm and Google was an unknown upstart. Since then, Sutherland has covered the whole technology landscape, concentrating on tracking the trends and figuring out the finances of large (and small) technology companies.

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