[lbo-talk] Apple CEO rejects 'tax evasion' charges

[Arthur Maisel]

I was amused that the U.S. Senate sprung into action against Apple after
Google's identical (or very similar) practice was criticized in the English
Parliament. I believe this practice is not limited to Apple and Google but
is common among large corporations doing business in several nations. You
find the nation with the lowest tax rate and then your subsidiary in that
country buys the goods and services from the subsidiary in the high-tax
country and sells them in the low-tax country. The profits are therefore
"made" in the low-tax country. It even has a name: *transfer pricing. *I
don't think it was *invented* to evade taxes but to allow for a reasonable
accounting of a multinational's profits---but you know how these things go:
Invent the golf club and soon someone is using it to jimmy open someone
else's front door.

On Tue, May 21, 2013 at 11:34 PM, Eubulides <paraconsistent at comcast.net>wrote:


> On 5/21/2013 3:41 PM, Jordan Hayes wrote:
>
>> Max writes:
>>
>>  The crime is what's legal, and what's legal is
>>> decided by the Congress.
>>>
>>
>> It's not clear to me that this is "legal" ... it's a loophole, because
>> it takes advantage of a situation that was clearly spelled-out in the
>> law -- if you make money, you pay tax on it, unless you pay tax to
>> someone else, then we figure out what's fair -- and probably isn't
>> exploitable by many.  But the sheer size of the dollars involved makes
>> it worth it to try, even if your CEO gets put in front of a Senate
>> Committee.
>>
>> The way you can tell how bad this smells is that they are 'warehousing'
>> the profits offshore, hoping for a 'repatriation discount' -- the money
>> is truely no good to them where it is, and they know it.  And they know
>> that if they bring it back to the US, where it could at least be used to
>> repurchase stock, or pay a dividend (not that either of those things is
>> any good for the rest of us), they will get taxed on it.
>>
>> So they are in effect holding out for a better deal.
>>
>> Which doesn't make it legal.
>>
>> /jordan
>>
>
> ================
>
> Ah yes, the tired old law/crime binary and the *production* of legality
> out of....what, exactly?
>
> If drones can be rhetorically laundered into legality, so can intellectual
> property in corn genomes, anarcho-capitalism or smoking weed in city parks
> in the presence of angst addled mothers with 3 year olds; who needs Derrida
> or Michael Huemer or A. John Simmons disputing the history of the
> foundations of the so-called duty to obey when corporate lawyers can make a
> toy of the discourse of law.
>
> In the next 20-30 years I'd be willing to wager that the legal nihilism
> that has ensconsed itself in the former USSR will become ever more
> fashionable in the US. Just type legal nihilism russia into the google if
> you think I am kibbitzing.
>
> Apple is just the almost end game on the corporate tax debate that took
> off with Obama's 1st term.
>
> E.
>
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