Tim Cook: Apple Has No Tax-Advantage Over Domestic U.S. Companies


Screen Shot 2013-05-21 at 12.10.24 PM

“Do you feel that you’ve been bullied or harassed by this committee?” Senator John McCain has just asked Tim Cook at the Senate Sub-Committee Hearing to Examine Offshore Profit Shifting and Tax Avoidance by Apple Inc.

“I feel good to be participating in this. I hope to help the process. I’d like comprehensive tax reform to be passed this year, and we will help in anyway we can.”

“I wasn’t dragged here, sir,” Tim Cook laughed.

“You’ve obviously taken advantage legally of a number of loopholes. Couldn’t you draw a conclusion that you have an unfair advantage over domestic companies?” asked McCain.

“No, it’s not the way I see it. Apple pays 30.5% of its profits in taxes on the United States. I would guess that’s high on the list of how it stacks up against other companies. We do have a low tax rate outside the U.S., but it’s for products we sell there, not within. So the way I look at this is there’s no shifting going on.”

Tim Cook is saying that because domestic companies operate only domestically, Apple has no advantage over them domestically: it only has an international advantage, which isn’t applicable in talking about “competitive advantage” in a U.S.-only context.