The Celtic Phoenix - A thread to list the economic miracles of Michael Noonan & Fine Gael

[Tim_Riggins]

@anon7035031

You are the one who claimed that Apple have an effective tax rate between 20 - 40%, with nothing to support that. We are discussing income tax, not other costs of doing business, which are in their operating expenses (employee SS contributions, employer insurance, that sort of thing).

I brought up the 20-40%, not you. I said it depends how you measure it. Apple pay a substantial amount of taxes of all kinds. Income tax is also a cost of doing business, the point about what Apple pays in taxes is to stop people talking shite about Apple not paying tax.

@anon7035031

Nobody knows what Apple pays in income tax to various jurisdictions as they don’t disclose it. This is what we know:

Apple provide for taxes of about 26% on their income statement, how much is actually paid or deferred is largely unknown (including to investors). We do know from their 2015 annual report that the provision for foreign earnings was $1.5B on $33.6B or 4.5%. The only way to achieve that kind of number is via tax havens. There is also a significant amount of foreign generated income for which income tax has not been provided. This statement from the 2015 report provides a clue " As of Sept 6, 2015, US income taxes have not been provided on $91.5B of such earnings" (earnings earlier disclosed as generated in Irish subsidies).

It isn’t particularly difficult. If you read financial statements you will see that they do in fact disclose what they pay in federal, state and foreign income taxes. Financial statements also have these things called cash flows, which tell you the various cash outflows during the year. I’m surprised a sage investor wouldn’t know this.

Here you go, here is the disclosure to their accounts.

And here is your cash flow.

So Apple provided for approx 25% on income for 2014 in income taxes, circa 14 billion and in the next year paid 13.25 billion out. In 2013 they provided for 13 billion of tax (effective rate of 26.5%) and in 2014 they paid out 10 billion (effective cash out of 21%). Whilst there are deferrals, this isn’t particularly hard to look at. The majority of their headline tax rate, is paid out.

And well done for highlighting what I already said. No tax was provided on 110 billion, meaning that headline “effective” rate doesn’t include any deferred tax on this amount meaning it is utterly wrong to claim this is increasing the provision. Apple provide a disclosure but admit to not providing for this. As I pointed out, investors all would consider this when investing.

@anon7035031

As to where the 10% effective tax number came from, the Senate committee in 2013 disclosed that from 2009 to 2011 Apple had pre-tax income of $65B and paid the US Treasury $5.3B or 8.2%. We know from their own annual report they provide for a very low income tax rate on foreign profits (4.5%), so assuming foreign profits are 60% of total, that works out at about an 11% effective tax rate.

Please provide a link to this. You mentioned all these tax experts but have yet to link anything. I have looked at their cash flows and nothing corroborates what you’ve said. The cash flows for those years show 9 billion being paid to the treasury. If you add up the 3 years in question the actual provision for tax was 16.6 billion and in 2010-12 they paid over 13.717 billion dollars.

You reference the annual report, but I can’t see how you failed to notice these facts.