Rotten Apple, Part 2

Gonna say that I wasn't aware as to the extent that Apple plays the bad corporate citizen game, but the NY Times continuing "iEconomy" series has been very illuminating. Apple's profits in 2011 doubled from 2010, their tax payments basically remained the same through a number of accounting gimmicks and offshore shell games.  This weekend's installment discusses those tax games, dubbed "The Double Irish with a Dutch Sandwich".

Apple, the world’s most profitable technology company, doesn’t design iPhones here. It doesn’t run AppleCare customer service from this city. And it doesn’t manufacture MacBooks or iPads anywhere nearby.

Yet, with a handful of employees in a small office here in Reno, Apple has done something central to its corporate strategy: it has avoided millions of dollars in taxes in California and 20 other states. 

Apple’s headquarters are in Cupertino, Calif. By putting an office in Reno, just 200 miles away, to collect and invest the company’s profits, Apple sidesteps state income taxes on some of those gains. 

California’s corporate tax rate is 8.84 percent. Nevada’s? Zero. 

Setting up an office in Reno is just one of many legal methods Apple uses to reduce its worldwide tax bill by billions of dollars each year. As it has in Nevada, Apple has created subsidiaries in low-tax places like Ireland, the Netherlands, Luxembourg and the British Virgin Islands — some little more than a letterbox or an anonymous office — that help cut the taxes it pays around the world.

And Republicans and conservatives will tell you that the problem isn't the tax code that allows states to play their zero sum games with jobs, nor is it Apple setting up their jobs in California to take advantage of Silicon Valley and paying zero taxes in Nevada as a contribution back.

No, the problem is California has a corporate tax rate above zero percent, and that's inherently evil.  Meanwhile, the reason why Apple stays in California includes some $400 million in R&D tax credits and grants.  Have your cake and eat it too, and other US multi-national corporations are following suit.

In the GOP world, it's Red States vs Blue ones.  We're not united at all, we're fighting each other for resources through war by any other means, most of it economic.  No wonder our national economy is weak.

They don't want anyone else to be a part of their "America".