Apple paid only 1.9% in taxes on overseas earnings, highlighting loopholes… (Economic Times )
We all know there are plenty of perfectly legal ways to finesse the U.S. tax system. And any company that puts its mind to it can seriously reduce its obligations to Uncle Sam.
So it shouldn't come as much of a surprise that Apple, the world's most valuable company, paid an income tax rate of only 1.9% on its earnings outside the country in its latest fiscal year, according to a regulatory filing.
Apple paid $713 million in tax on foreign earnings of $36.8 billion in the fiscal year ended Sept. 29. The 1.9% tax rate compares with a general U.S. corporate tax rate of 35%.
Again, no one is saying Apple is doing anything illegal. And it's certainly not like the tech giant is the only U.S. company working the system.
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What that under-2% tax rate shows is how messed up our tax system is. You could argue that any company of Apple's clout would be remiss if it didn't do everything possible to exploit every last loophole it can get its corporate hands on.
Businesses say they'd be happy to bring more money home, as long as they didn't have to take a heavy tax hit in doing so.
I'm thinking that if a company enjoys the many rights and benefits of being based in the United States, it should live up to its obligations, just like any other "citizen."
Sen. Carl Levin (D-Mich.) has introduced legislation that would, among other things, place a company's total earnings under U.S. laws if it's clear the company is owned and operated by U.S. interests.
He estimates his bill -- S. 2075 -- would reduce the federal deficit by at least $130 billion over 10 years.
There's been a lot of talk this election season about everyone paying their fair share. That conversation should involve everyone.