(Image source: Advocate)
BY LOGAN TITTLE
Apple appears to be just as savvy with savings as they are with gadgets.
The New York Times revealed the company has found ways around the tax code over the years — amounting to a few billion dollars in tax savings.
ABC’s WXYZ explains—
“Instead of collecting and investing its profits in California where the corporate tax rate is almost 9%, we’re told it sent its funds to Reno, Nevada where its 0.”
And that’s only in the U.S. Transactions routed through Luxembourg and other places in the European market allowed for low-rate taxing as well.
A writer for the Business Insider summed up a few more strategies.
“Apple is getting tax credits from California for conducting ‘research and development’ in California … Apple makes sure that salespeople located in high-tax countries are actually employed by Apple subsidiaries in low-tax countries … many global ‘iTunes’ sales legally happen in Luxembourg …This dodges taxes in the U.S ... and other countries that would charge much higher rates.”
And Apple isn’t the only one taking advantage of tax-code loopholes. A former Treasury Department economist told the New York Times it’s common—and legal.
“’Apple, like many other multinationals, is using perfectly legal methods to keep a significant portion of their profits out of the hands of the I.R.S … And when America’s most profitable companies pay less, the general public has to pay more.’”
But Care2.com says—while this is all legal—it doesn’t look very good next to the $9.2 billion budget crisis in California.
“The result is that, even while the technology industry is increasingly the largest and most valued in the U.S., government and corporate data reveal that such companies are the least taxed.”
Apple sent a response to the New York Times that can be seen on their website.