Apple Avoids Billions in Taxes

[Abe Hoffman]

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

"By putting an office in Reno to collect and invest the company’s profits, Apple sidesteps state income taxes on some of those gains."

"Apple has also 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."

http://www.nytimes.com/2012/04/29/b...ategy-aims-at-low-tax-states-and-nations.html

 

[OrangeYankee]

Hmm and they focus on how to stick it to them instead of seeing the elephant in the room that high Corporate Taxes (America is the highest by the way) cause companies to flee. Corporate Taxes do one thing: they are a cost of business and that cost is passed directly to the consumer. That article is very telling and very typical of our mindset sadly.

 

[Gramps]

Hmm and they focus on how to stick it to them instead of seeing the elephant in the room that high Corporate Taxes (America is the highest by the way) cause companies to flee. Corporate Taxes do one thing: they are a cost of business and that cost is passed directly to the consumer. That article is very telling and very typical of our mindset sadly.

IMO wages are as big if not a bigger factor when companies "flee" to other countries.
Corporate. taxes could be zero and still not be able to compete.

 

[BigPapaVol]

IMO wages are as big if not a bigger factor when companies "flee" to other countries.
Corporate. taxes could be zero and still not be able to compete.

You're ignoring service companies.

 

[Orangeslice13]

people do it all the time. You don't like the rules and laws of the state you live in? Move.

 

[BenGrimm]

Hmm and they focus on how to stick it to them instead of seeing the elephant in the room that high Corporate Taxes (America is the highest by the way) cause companies to flee. Corporate Taxes do one thing: they are a cost of business and that cost is passed directly to the consumer. That article is very telling and very typical of our mindset sadly.

Sounds like they are skirting state taxes not fed.

I was actually coming her to start a thread about Amazon and sales tax. They just settled in Texas and will start collecting it in the state in July.

As a regular Amazon customer I'm against this but I do think the states should get something out these mega online retailers. Amazon already has an unfair advantage when it comes to pricing. Throw in no sales tax and the small local brick and mortar stores can't compete.

And I'm one of those guys that goes to a store and uses my phone to scan barcodes to price check amazon before purchasing.

 

[95 Vol Alum]

I got an email from Amazon last week stating I owe the state taxes on my purchases from them in 2011. Included a summary of what I spent.

 

[RespectTradition]

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

"By putting an office in Reno to collect and invest the company’s profits, Apple sidesteps state income taxes on some of those gains."

"Apple has also 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."

http://www.nytimes.com/2012/04/29/b...ategy-aims-at-low-tax-states-and-nations.html

Things like this make me glad I own Apple stock.

 

[BenGrimm]

I got an email from Amazon last week stating I owe the state taxes on my purchases from them in 2011. Included a summary of what I spent.

WTF? What state do you live in? I think of they tried to back tax me I would cease being their customer.

 

[95 Vol Alum]

Tennessee

Hello from Amazon.com,

Thank you for being a loyal customer of Amazon.com LLC. *We appreciate your business and look forward to continuing to provide you vast selection, low prices, fast delivery and convenience. *

As you may know, Amazon.com LLC is not required to collect sales or use taxes in Tennessee. *However, the state of Tennessee requires us to provide the following notice to you:

You may owe use tax on purchases you made from Amazon.com LLC during the previous calendar year. The amount of tax you may owe is based on the total sales price of the items you purchased during the calendar year unless an exemption exists under state law or you have already paid the tax. A sale is not exempt under state law because it is made through the Internet. The total sales price of purchases you had shipped to Tennessee in 2011 was $252.05. This is the amount that you may include on your Tennessee use tax return to calculate the appropriate use tax owed unless you have already paid the tax.

As purchases from Amazon.com LLC can be made through various sales channels, we have included directly below your breakdown of purchases from the various channels. *

Total sales from Amazon.com: Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more $252.05 * * * * **
Total sales from Shoes & Handbags - designer shoes, handbags, jewelry, watches, and fashion accessories | endless.com $0.00 * * * * *****
Total sales from MYHABIT Sign In $0.00 * * * * * * ***
Total sales from AmazonWireless: Cell Phones, Cell Phone Plans, and Accessories $0.00 *****
Total sales from AmazonSupply.com: The Store for Business & Industry $0.00 ***

In addition, the state of Tennessee requires us to provide you with the following link that you can use to get more information and pay any taxes due:

Use Tax Page: https://apps.tn.gov/usetax
Please note the following:

• While Amazon.com LLC does not report this information directly to the state of Tennessee we are required to provide this information to you based on Tennessee Code T.C.A. § 67-6-5 (f)(3) signed into law March 23, 2012.
• This notification has been sent to all customers that had purchases delivered to Tennessee. If you are not a resident of Tennessee, the most common reason for receiving this notification is that you may have sent a gift to a recipient in the state.

For more information you may also view our Tennessee Use Tax Notification Page at:
Amazon.com Help: Tennessee Use Tax Notifications

Sincerely,
Customer Service
Amazon.com

 

[OrangeYankee]

Ya Tennessee made them not only collect taxes but they have to actually bill you for them... That part is kinda crappy IMHO

And I understand that wages are a big factor but argue if we eliminate much of the red tape of taxes and regulations we could be a little more lucrative...

 

[davethevol]

• While Amazon.com LLC does not report this information directly to the state of Tennessee we are required to provide this information to you based on Tennessee Code T.C.A. § 67-6-5 (f)(3) signed into law March 23, 2012.

I wonder if Amazon is trying to tick people off, because if it was signed into law in 2012, then people wouldn't owe back taxes from 2011.

 

[RespectTradition]

I wonder if Amazon is trying to tick people off, because if it was signed into law in 2012, then people wouldn't owe back taxes from 2011.

The law requiring the use tax was passed a couple of years ago, iirc.

The new law just requires online vendors to notify their customers if the customer qualifies to pay.

IOW, you may have owed it all along, only now they have to let you know about it.

 

[95 Vol Alum]

I wonder if Amazon is trying to tick people off, because if it was signed into law in 2012, then people wouldn't owe back taxes from 2011.

I believe that the law requiring you to pay taxes on this stuff goes back to 2009. The law passed in 2012 requires Amazon to inform you.

 

[davethevol]

Weird. Oh well, I still wouldn't pay it if I wasn't charged for it at the time.

 

[lawgator1]

Hmm and they focus on how to stick it to them instead of seeing the elephant in the room that high Corporate Taxes (America is the highest by the way) cause companies to flee. Corporate Taxes do one thing: they are a cost of business and that cost is passed directly to the consumer. That article is very telling and very typical of our mindset sadly.

The rate is irrelevant if they avoid paying it. Such a false concern.

I mean, if they eliminated the loopholes, and got 100 pct payment, the rate could be much lower.

 

[rjd970]

The rate is irrelevant if they avoid paying it. Such a false concern.

I mean, if they eliminated the loopholes, and got 100 pct payment, the rate could be much lower.

Agreed. I'm all for lowering the rate and eliminating loopholes. I can understand why corporations aren't.

 

[volinbham]

Rate is relevant given there are competing (lower) rates elsewhere.

Definitely need to simplify the code but the rates clearly play a role in this type of rate shopping behavior.

It's clear how this works from state to state. There has been massive migration of business from higher tax states to lower tax states. Same with people.

 

[rjd970]

Rate is relevant given there are competing (lower) rates elsewhere.

Definitely need to simplify the code but the rates clearly play a role in this type of rate shopping behavior.

It's clear how this works from state to state. There has been massive migration of business from higher tax states to lower tax states. Same with people.

We are also seeing migration to right to work states as well. Alabama has seen a huge influx of manufacturing jobs in the last decade, especially in the automotive sector.

 

[BenGrimm]

I live in TN and I buy stuff on Amazon ALL THE TIME. I have only been taxed once or twice when the vendor had a location in TN. (As a side note one of those times turned out to be from someone that was literally 10 miles from my house but I didn't realize it until it arrived and I saw the return address. I had to pay shipping and tax. Needless to say I was pissed auff). I've never gotten one of those emails either.

Mostly I try to only buy from Amazon as the primary seller unless that just don't have it.

 

[VolsNSkinsFan]

Why are you pissed you had to pay taxes? It wasn't like the product teleported to your front door. Your states infrastructure was used

 

[volved]

I live in TN and I buy stuff on Amazon ALL THE TIME. I have only been taxed once or twice when the vendor had a location in TN.

The problem is that Amazon now has a distribution center in Tennessee. They have an agreement with TN that they will start collecting TN sales tax in 2014. The sales tax notices in the meantime are part of the agreement.

Amazon sends out sales tax notices

 

[BenGrimm]

Why are you pissed you had to pay taxes? It wasn't like the product teleported to your front door. Your states infrastructure was used

I wasn't pissed about the tax. It was the $6 shipping for 10 miles. Unlike ebay, Amazon doesn't show where the vendor is located on the product page. If I had known it was right down the road from me I would have picked it up myself.

 

[utvolpj]

Amazon is in the process of opening a dist center in every state as they move into the building supply business. It will become more common

 

[BenGrimm]

The problem is that Amazon now has a distribution center in Tennessee. They have an agreement with TN that they will start collecting TN sales tax in 2014. The sales tax notices in the meantime are part of the agreement.

Amazon sends out sales tax notices

I guess I should be expecting that email soon. According to the article it doesn't sound like there are any penalties if you don't pay it and Amazon doesn't report the names of those who did and those who didn't to the state.

I don't have a problem with it starting in 2014. Honestly, it should be collected at the point of sale.