News / USA

Apple Defends Tax Avoidance

Apple CEO Tim Cook, center, is surrounded by his team during a break from testifying on Capitol Hill in Washington, May 21, 2013.
Apple CEO Tim Cook, center, is surrounded by his team during a break from testifying on Capitol Hill in Washington, May 21, 2013.
Michael Bowman
Top executives of American technology giant Apple faced intense questioning from U.S. lawmakers about the company's use of off-shore entities that allow it to shield billions of dollars in global profits from federal taxes.  Apple’s chief executive admitted to no wrongdoing, but urged an overhaul of the U.S. tax code.
 
Apple’s high-tech consumer products are seemingly everywhere, as noted by Democratic Senator Carl Levin at a hearing of the Permanent Subcommittee on Investigations. “Just like millions around the world, I carry an iPhone in my pocket," he said. 
 
Levin said Apple’s successful business model involves shielding profits from federal taxes. “Apple has sought the Holy Grail of tax avoidance: off-shore corporations that it argues are not for tax purposes resident anywhere in any nation," he said. 
 
Levin said U.S. corporations hold more than $1 trillion in off-shore profits and harm the nation in the process. “They off-load Apple’s tax burden onto other taxpayers, particularly onto working families and small businesses.  The lost tax revenue feeds a budget deficit," he said. 
 
Republican Senator John McCain sounded equally dismayed. “It is completely outrageous that Apple has not only dodged full payment of U.S. taxes, but has managed to evade paying taxes around the world through its convoluted and pernicious strategy," he said. 

Related video report by Jeff Seldin

Tempers Flare, Accusations Fly Over US Tax Loopholesi
X
May 22, 2013 1:52 PM
Tempers are flaring in Washington over concerns and allegations some of the biggest U.S. companies are striking deals with other countries to avoid paying taxes. On Tuesday, lawmakers put one of the best known U.S. companies - Apple - in the spotlight. VOA's Jeff Seldin has more.
Apple’s chief executive, Timothy Cook, defended his company’s practices. “We pay all the taxes we owe, every single dollar.  We not only comply with the laws, but we comply with the spirit of the laws.  We do not depend on tax gimmicks," he said. 
 
But Cook urged an overhaul of America’s astonishingly complex tax code, even if doing so would incur a higher tax burden for Apple.
 
“We recommend a dramatic simplification of the corporate tax code.  This reform should be revenue neutral, eliminate all corporate tax expenditures, lower corporate tax rates, and implement a reasonable tax on foreign earnings that allows the free flow of capital back to the United States," he said. 
 
Some Republican senators objected to the congressional grilling of Apple over its compliance with a tax code crafted on Capitol Hill. 
 
Senator Rand Paul said, “I am offended by a $4 trillion government bullying, berating and badgering one of America’s greatest success stories.  If anyone should be on trial here, it should be Congress.”
 
That brought a sharp reply from Senator Levin. “Apple is a great company.  But no company should be able to determine how much it is going to pay in taxes, how many profits they are going to keep off-shore," he said. 
 
The United States has one of the world’s highest corporate tax rates at 35 percent.  But loopholes and special deductions allow many large firms to pay a significantly lower share of profits.  Most tax reform proposals call for lowering corporate tax rates while eliminating loopholes, yielding a simpler and fairer tax code for all commercial entities. 

You May Like

Obama: Alaskans Feel Signs of Climate Change

They're seeing bigger storm surges as sea ice melts, more wildfires, erosion of glaciers, shorelines More

1855 Slave Brochure Starkly Details Sale of Black Americans

Document lists entire families that were up for sale in New Orleans, offering graphic insight into the slavery trade More

Katrina Brought Enduring Changes to New Orleans

The city’s recovery is the result of the people and culture the city is famous for, as well as newcomers and start-up industries More

This forum has been closed.
Comment Sorting
Comments
     
by: Yoshi from: Sapporo
May 23, 2013 3:51 AM
Six billion dollars a year, yes, it is a huge amount of tax Apple pays. But I would like to ask how much does it get as net profit.

It is said tha tits net profit of this quater was nine point four billion dollars. Is it only me who think Apple has good reason to pay more tax?

by: david lulasa from: tambua,gimaRAKWA,HAMISI,V
May 22, 2013 6:51 AM
apple employees in america and africa are equal,but they are not paid the same for the same measure of work..though apple is selling expensively.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Colombians Flee Venezuela as Border Crisis Escalatesi
X
August 27, 2015 2:08 AM
Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Is China's Economic Data Accurate?

Some investors say China's wild stock market gyrations have been made worse by worries about the reliability of that nation's economic data. And some critics say the reports can mislead investors by painting an unrealistically-strong picture of the economy. A key China scholar says Beijing is not fudging ((manipulating)) the numbers, but that the economy is evolving quickly from smoke-stack industries to services, and the ways of tracking new economic activity are falling behind the change. V
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Shipping Containers Provide Experimental Housing

Housing prices around the San Francisco Bay area are out of reach for many people, so some young entrepreneurs, artists and tech industry workers are creating their own houses using converted shipping containers. But as VOA's Mike O’Sullivan reports from Oakland, the effort requires ingenuity and dealing with restrictive local laws.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video Technique May Eliminate Drill-and-Fill Dental Care

Many people dread visiting dentists because they're afraid of drills. Now, however, a technology developed by a British firm promises to eliminate the need for mechanical cleaning of dental cavities by speeding a natural process of tooth repair. VOA’s George Putic reports.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.
Video

Video French Experiment in Integrating Roma Under Threat

Plans to destroy France’s oldest slum have sparked an outcry on the part of its Roma residents. As Lisa Bryant reports from the Paris suburb of La Courneuve, rights groups argue the community is a fledgling experiment on integrating Roma who are often outcasts in many parts of Europe.
Video

Video Kenyans Turn to Agriculture for Business

Each year Kenyan universities continue to churn out graduates for the job market despite the already existing high rate of unemployment among youth in the country. Some of these young men and women have realized that agriculture can be as rewarding as any other business or job, and they are resorting to agribusiness in large numbers as a way of tackling unemployment. Rael Ombuor reports for VOA.
Video

Video First Women Graduate Elite Army Ranger School

Two women are making history for the U.S. Army by proving they are among the toughest of the tough. VOA's Carla Babb reports from Fort Benning, Georgia as 94 men and those two women rise as graduates of the difficult Ranger school.

VOA Blogs