
Apple paid only 2% corporate tax outside US - wr1472
http://www.bbc.co.uk/news/business-20197710
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rayiner
I call for a moratorium on journalists quoting taxes either only on a single
year basis or singling out only a particular type of tax to focus on.

The proper way to understand the tax burden of a company is to look at the
number analysts use: effective tax rate, averaged over some substantial period
of time. This is not a complicated number. You basically take 100% - (income
after all taxes) / (income before all taxes)

Apple's effective tax rate, according to their 10-K filings, has been 25-30%
for the last 3 years:
[http://www.forbes.com/sites/timworstall/2012/04/18/apples-9-...](http://www.forbes.com/sites/timworstall/2012/04/18/apples-9-8-tax-
rate-entirely-mind-gargling-nonsense/)

I should note that there is, somewhat ironically, a wild inaccuracy in this
Forbes article which I don't want to seem like I'm endorsing: "We might ponder
upon the way that federal taxation as a share of the entire economy has grown
hugely over this period as well, meaning that what you can extract from
corporations has fallen not because corporations are taxed any less but
because others are taxed much more."

Total federal taxes as a %-age of GDP have fluctuated between 15-20% for the
last 50 years. It was as high as 19% as early as 1952, and hasn't been as low
as it is now (15%) since 1950. There is a mythology that the federal
government keeps getting bigger, but almost all the growth in the federal
government came in the 10 year period between 1934 and 1944. This growth can
be explained almost entirely by just three things introduced in this era:
social security, medicare/medicaid, and a huge peacetime military.

See:
[http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Doc...](http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=205)

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protomyth
"All of the companies do pay considerable amounts of other taxes in the UK
such as National Insurance and raise large sums of VAT."

~~~
mtgx
It's fair to mention the other taxes like national insurance, but VAT
shouldn't be mentioned here. VAT is simply "collected" from the customer, and
then sent to the Government. No company ever includes VAT in their prices when
they plan out the prices. They are simply added after the fact, and the
consumer pays for it.

So disregarding other taxes, if say Apple wants $500 for the iPad, then they
won't include the VAT in that price, they will simply add the fact to the $500
price, and make it $600, or whatever the VAT is in that country.

~~~
spindritf
All taxes are collected from the customer, just not necessarily "simply".
Arbitrarily dividing taxes into simple and complex and then reporting only on
the complex seems even more misleading to me.

