Apple looks forward to wiping $47bn off its overseas profit tax bill – thanks to US shakeup While Apple may have to fork out €13bn (£11.4bn) to the Irish government in back taxes, on the other side of the Pond it could gain $47.2bn (£35.2bn) in tax breaks. The US Senate and House are working on shaking up America's tax rules, mostly giving the super-rich tax breaks while giving poor people a rough deal. The draft …
Sure, Apple's gains are great for those of us who own its stock, but half of the US population doesn't own any stock so stockholders getting richer doesn't benefit them. That's who is getting hurt (or at the very least not helped) by Trump's self-serving tax plan.
It not only includes the well publicized cut for pass thru entities like S-corporations that directly benefits Trump, it also includes tax breaks for private jet owners and golf course operators. Someone please tell me how tax breaks on private jets and golf courses will trickle down and benefit the little guy! This type of self-dealing should be saved for banana republics, not the USA.
"so that Apple can do a share buy back and drive up the values of the pensions and investments of us foreigners?"
Most of Apples costs are off shore (manufacturing and IP licencing), so I doubt they'll bring all of it back, probably not even most of it, especially when it's stashed/invested in tax havens low tax countries where the tax bill is still less than 14%
"Someone please tell me how tax breaks on private jets and golf courses will trickle down and benefit the little guy!"
I take your point wholeheartedly, but does the US not have plenty of open access golf courses that anyone can turn up to pay to play? There's loads here in the UK, including municipal ones and lots of people from all walks of life play. I'm not saying golf course deserve to be singled out for tax breaks, but the "little guy" can and does play golf, at least here in the UK.
Hold it! Hold it! Hold it!
I doubt it that US banks, however squeaky clean (or not...) could have brought us The Great Financial Collapse Of 2008 all by themselves. And they didn't.
RBS, LLoyds and Northern Rock all did what they could to help them out. They must have done a good job: just look at how their respective C-suites were rewarded.
And, while we're praising the great and the good, how about a small tip of the hat to Barclays and RBS for their sterling efforts to enhance the workings of LIBOR a little bit later.
"US banks that, through their chicanery, brought us Financial Collapse 2008"
Not on their own, they didn't. Not only did they have help from non-US banks, they also had help from politicians who thought that in no way was a house price bubble inflationary and to be taken into account in fixing interest rates.
And, while we're praising the great and the good....
US and UK banks were crooks, primarily in lending to the uncreditworthy on the joint assumptions that it wouldn't go wrong, and if it did go wrong they'd get bailed out. But accusing the UK and US banks alone ignores the identical behaviour in Europe, where French & German banks did the same in lending to the uncreditworthy all across southern Europe. When the brown stuff hit the fan, just like US and UK monetary authorities, the French, Germans and ECB bailed out their banks. You can see the same in China, it was the cause of Japan's two decade long malaise, its the same in any part of the world.
Financial services is a rank, disgusting, short termist sector, where the management and individuals will always put their over-generous bonus arrangements ahead of any form of common sense, propriety, or morality.
There is a misconception on this. The money could be in any bank or TBills. The overseas part is just an accounting thing. Until they move it on the books and pay taxes on it, they can only use the money for certain things, but could be in a bank anywhere in the world, including the US.
They could just leave the money overseas and not pay the 14%, leaving them hanging on to the whole $100bn-odd tax instead of handing over $49bn-ish.
I'm sure there are those in the US who will now be saying that of course Apple will be only too happy to bring their money back onshore and only pay $49bn, because that's the kind of civic-minded people they are. Therefore more money will be available to the Great Unwashed, spreading joy & happiness. This money could then be used to boost the economy, as the GU go forth and buy unicorn droppings and fairy dust.
Apple didn't agree to pay the €13 billion. They agreed with the Irish government to place it in escrow pending the outcome of Ireland and Apple's appeal against the European Commission's ruling. That's a somewhat different proposition than 'paying up'. If their appeal fails, *then* they'll pay up (or come to another arrangement).
That said, the corporate tax rate in the US may be listed as 35%, but companies rarely pay that. They *always* have tax rebates of some sort or description that drops their effective rate to 10% or less. The 'tax dodge for rich people' (i.e. the current reform) will shrink their tax due, yes, but there will be rebates again...
mostly giving the super-rich tax breaks while giving poor people a rough deal
First, this statement has nothing to do with the write-up. Second, if you really wanted to comment on the implications of the proposal and knew a just a little about how taxes for lower income households work, your statement would need to be altered to something along the lines of "...giving companies fewer excuses for higher prices because they have fewer federal taxes to pass on the the consumer, and those that currently do not pay any taxes will continue to not pay any taxes despite the changes."
Thanks for hooking me, I feel much better now.
You're suggesting that Apple "up one nostril and down the other" pricing is because they have to pass taxes (that they haven't actually paid in years) onto the low-income customers that flock to buy their products?
Who is trolling whom?
If you are suggesting that after 24 years demonstrably failing to work that Trickle Down Economics are gong to save the country, well, I'm not biting.
Reagan, George the First, And George the Second all proved in double term administrations that Trickle Down is Cock-Up.
Indeed, I remember in the second four of Reagan's reign, the newspapers were wryly pointing out that at the height of his loudly touted "boom economy", growth was actually behind that at the height of the Great Depression.
But I'm sure if the Republicans just try it often enough it will work. The law of averages would suggest it has to, eventually.
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