Apple won’t pay Cupertino ‘head tax’ after all

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It's not like Apple has the cash to spare!
Photo: Ste Smith/Cult of Mac

Apple won’t have to pay additional taxes to the city of Cupertino based on the company’s number of local employees, city officials have decided.

Some Cupertino City Council members planned to give voters the opportunity to decide whether Apple, and other large local businesses, should pay a “head tax.” Apple would have paid around $9.4 million annually to the city. However, those plans have now been scrapped.

An employee tax for Apple

The new tax would have hit any company with upward of 100 employees. Since Apple is Cupertino’s largest employer, it would have paid approximately 92 percent of the $10.2 million the city estimated it would take in. This money would have gone into local services — namely transportation.

However, members of the business community hit back against the proposal. On Monday, Apple sent a letter to the Cupertino City Council outlining all the good things the company has done for the city, its home since the 1970s.

It’s not a total loss for the council, though. Apple executive Mike Foulkes, director of state and local governmental affairs, attended a meeting about the proposed head tax Tuesday night. He said Apple is happy to work with the council to come up with transportation solutions to help reduce congestion.

Employee taxes are the hot new thing

The proposed Cupertino head tax was similar to levies popping up around the United States. These are often in areas that are home to tech giants. For instance, earlier this year, Amazon’s hometown of Seattle introduced a tax charging large companies in the area an extra $275 per employee.

Mountain View, California, is considering implementing a similar tax, which could cost Alphabet $5 million. This proposed tax will be voted on by locals in November.

Coming off another record financial quarter, Apple could certainly have afforded the new tax. Nonetheless, the company is sure to be glad not to have to pay it. You don’t get to be the world’s most valuable company by paying out more cash than you need to!

Source: San Francisco Chronicle