[simonh]

> By trying to weasel out of paying any US taxes, they can't spend their own money.

It's not about avoiding paying any US taxes, it's about avoiding paying US taxes on earnings abroad. This is why so many Americans living abroad are giving up their US citizenship. I'm a Brit living in London and I know several American born friends that have become British citizens to avoid paying both UK and US taxes on their earnings. In fact the current mayor of London, Boris Johnson, is Anglo_America and even though he has never lived or worked in the USA, because he had US citizenship the IRS hit him with a massive tax bill on his lifetime earnings in the UK. On what possible basis could anyone consider that appropriate? He promptly gave up his US citizenship.

The US Government's attitude to earnings abroad is IMHO utterly reprehensible. I'm not aware of any other country that does this. I'm not a US citizen but I do work for a US owned company.

[michaelt]

  The US Government's attitude to earnings abroad
  is IMHO utterly reprehensible.

I'm also a Brit and I disagree - at least in the case of multinational companies like Apple. If you have a lower tax rate for profits from abroad, the American operation can "license intellectual property" from shell companies in tax havens, then the American operation makes no profits (and hence pays no tax) while the tax haven shell company makes big profits (but pays no tax).

America has a system of foreign tax credits - so if the American tax rate is 35% and the company was taxed 20% in the country where they made the profits, when they repatriate the money to America they only have to pay 15%.

This is much fairer than the British approach to tax-dodging which appears to be "ignore it and maybe the crooks will donate to our political party".

[mike_hearn]

It's normal that companies can choose where to book revenue by performing various forms of cost shifting. The entire EU system of corporate taxation is based on that principle (tax is paid where your HQ is registered). Global tax treaties, ditto. It's the USA that is weird and exceptional in this case.

So the British approach is not to "ignore tax dodging". It's to theoretically apply the same system it's always used, along with everywhere else, whilst simultaneously trying to appease populist anger over spending cuts by branding various foreign companies as socially irresponsible, although (a) there is no chance of this making any different to austerity and (b) those companies were only following rules that were considered uncontroversial not so long ago.

It's kind of a dumb strategy.

[jbooth]

"It's not about avoiding paying any US taxes, it's about avoiding paying US taxes on earnings abroad."

It's also about structuring earnings so that they happen to be earned abroad.

https://en.wikipedia.org/wiki/Double_Irish_arrangement

[minot]

Here are my simple thoughts.

If an entity pays for an Apple product or service in the US, Apple has earned an income. This income is without doubt subject to taxes in the US. As far as I know Apple does pay US taxes on these monies. Do we agree this far?

I don't see why we can fault Apple for not repatriating income it earned abroad. They can do as they please with it as long as they don't bring it back in the US. I'm not saying they shouldn't pay a tax if/when they bring it back. I am just saying we should not demonize them for not bringing it back.

[jbooth]

Here are my thoughts:

America invented the transistor and Internet with tax money, plus educated most of the engineers who built those products up to grade 12. But everyone acts like it'd be some moral tragedy for Apple to pay taxes back into that system. It's disgusting. Our society has been overrun by MBAs. Nobody thought like this 30 years ago.

Also you completely ignored my actual point about the flexibility of where money was 'earned' if you have good accountants.

[S4M]

> On what possible basis could anyone consider that appropriate?

Not a US citizen here, but I think the reason is that a US citizen has more privileges than someone else: it's easier to travel and get a work permit abroad, if something goes badly they are still under protection of the US government, etc.

This is due to the fact that USA are the most powerful country on Earth, and one of the reasons for that is its military power, which is very expensive.

So the US citizen residing somewhere else would still have to pay their share to be protected by their country.

Not saying that I completely agree but I think it's a valid reason.

[mike_hearn]

> I think the reason is that a US citizen has more privileges than someone else

Not the case. I have read that the most powerful passport in the world (as in, getting into countries visa free) is the British passport.

Additionally Americans, unlike citizens of other countries, get no protection from their host government. If they get evacuated from a disaster zone they get charged for the costs. And as everything the US Gov does is horrendously price inflated, there are cases of people getting "rescued" and then wishing they'd been left behind after being served with massive bills.

The way the USA taxes citizens abroad is indefensible. There's literally not one single defence for it.

(btw: there are two different Mike Hearn's posting in this thread! I am the other one)

[djrogers]

> If they get evacuated from a disaster zone they get charged for the costs. And as everything the US Gov does is horrendously price inflated, there are cases of people getting "rescued" and then wishing they'd been left behind after being served with massive bills.

Citation please? The only thing I've ever heard of even remotely close to this ate the occasional local search and rescue operations that are caused by poor judgement. That has nothing at all to do with the U.S. government.

The next time there's a disaster in almost any country - look around. That's a U.S. Navy carrier providing electricity for emergency relief. Those are U.S. Marines distributing rice, ponchos, and water. Those are U.S. Navy Corpsmen delivering first aid to the wounded.

As bad as people like to make this country out to be, we are the first ones there with the biggest shovel any time another country needs to be dug out.

[mike_hearn]

http://travel.state.gov/content/passports/english/emergencie...

Click the "Will the U.S. government pay for my travel? How much will it cost?" section.

As bad as people like to make this country out to be, we are the first ones there with the biggest shovel any time another country needs to be dug out.

It's not so. Go look at Yemen. The Chinese, Indians and Pakistanis evac'd their citizens when the war started. The USA left theirs to rot.

http://www.theguardian.com/world/2015/apr/01/american-civili...