Should Apple Pay More Taxes?

Politico reports on Senate allegations that Apple exploits loopholes to avoid paying US Income Taxes. Lawmakers openly admit that Apple hasn’t broken any laws, but claim that the company is ducking its fair share of taxes.

The article states that Apple paid $2.4 billion in Federal income taxes. The company also paid $2.5 billion in dividends, most of which is taxable to the stockholders receiving them. This is not to mention the windfall of taxes earned by the Federal government on capital gains from the astronomical  rise in Apple stock, taxes and fees on iPhones, and sales tax on Apple products.

Should Apple skip the loopholes and pay higher taxes as a public service? Or is Apple’s careful tax planning a reasonable way to protect shareholder value?

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About Mark P. Holtzman

Chair of Accounting Department at Seton Hall University. PhD from The University of Texas at Austin. Worked at Deloitte's New York Office. BSBA from Hofstra University.

4 comments

  1. it’s nice. good luck.

  2. Lots of big corporations like Apple are doing this to avoid pay taxes, they create a dummy corporation in other countries and show part of their product development being done there and hence avoid pay taxes. Why do you think these big monoliths keep a steady army of finance and legal experts?

  3. It is clear that the relevant governments need to get on top of this and similar situations with regards large companies and corporations tax contributions. I guess in reality the consumer may not be put off by such things but it doesn’t do much for positive brand awareness with many of the recent tax headlines.

  4. Pinny Friedman

    There are many laws and regulations in regards to income tax. Companies must pay the fair share of income taxes that they owe. That being said, if Apple can find a legal way to cut down on their taxes, then that is 100% fine. After all, a major part of accounting is trying to increase income (cut down on taxes) as long as its within the guidelines of the law. Therefore, Apple should not have to pay any extra taxes that they are not legally required to pay!!

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