Behind the Lobbying Effort that Helps Save Apple $2.4 Billion in Taxes a Year
The New York Times dropped another bomb on Apple’s “iEconomy” this weekend with an expose that shows how the world’s biggest corporation evades billions of dollars in taxes by creating subsidiaries in low-tax states and countries like Nevada, Ireland, the Netherlands, Luxembourg, and the British Virgin Islands. While some of Apple’s monumental success is due to the undeniable popularity of its products, the Times reports that Apple “has devised corporate strategies that take advantage of gaps in the tax code.” This has ultimately saved the company (and thus cost the public) as much as $2.4 billion a year, according to a recent study by a former Treasury Department economist.
Apple fights for favorable tax policies in the United States with a formidable army of lobbyists. According to the Center for Responsive Politics, Apple spent $2.3 million on lobbying last year and its lobbying expenditures have been steadily increasing over the past decade – in 2000, it only spent $360,000 on lobbying.
A big chunk of this is spent lobbying specifically on tax policy, especially repatriation legislation, which lets firms bring profits held overseas back to the United States at a cheaper tax rate. One bill in particular, the Freedom to Invest Act of 2011, would save companies like Apple, Google, and Cisco $78.7 billion, paid for by the American people.
This so-called tax holiday would let multinationals with more than $1 billion held abroad bring that cash back to the United States at a 5.25 percent tax rate, instead of the typical 35 percent top corporate rate. The idea is that those companies would pump that money into the American economy, especially through hiring workers.
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http://truth-out.org/news/item/8867-behind-the-lobbying-effort-that-helps-save-apple-$24-billion-in-taxes-a-year
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