Uncovering Apple’s Tax Havens

Apple in the hot seat.  Lawmakers say the company dodged billions in taxes on overseas profits.  We’ll look at the world of offshore tax escapes.

Apple CEO Tim Cook is sworn in on Capitol Hill in Washington, Tuesday, May 21, 2013, prior to testifying before the Senate Homeland Security and Governmental Affairs Permanent subcommittee on Investigations hearing. (J. Scott Applewhite/AP)

Apple CEO Tim Cook is sworn in on Capitol Hill in Washington, Tuesday, May 21, 2013, prior to testifying before the Senate Homeland Security and Governmental Affairs Permanent subcommittee on Investigations hearing. (J. Scott Applewhite/AP)

The headlines looked pretty bad for Apple this week on taxes and offshore shelters.  “Gimmicks.”  “Schemes.”  Billions dodged.  Stateless subsidiaries paying taxes nowhere, on giant revenues.

Then on Tuesday, Apple CEO Tim Cook in the hot seat in Washington, insisting that Apple is proud to be an American company, that it’s broken no laws.  Reminding Congress of the billions it does pay in U.S. taxes.  Apple is not the only U.S. corporation working the edges of tax law in the global economy. It’s a big deal.

Up next On Point: Apple’s taxes, American law and offshore escapes.

– Tom Ashbrook


Jesse Drucker, investigative reporter for Bloomberg News and author of the journalism series “The Great Corporate Tax Dodge.” (@JesseDrucker)

Kara Swisher, co-executive editor of the technology news website AllThingsD. (@karaswisher)

Edward Kleinbard, professor of law at the University of Southern California’s School of Law. He served as Chief of Staff of the Joint Committee on Taxation.

Alan Auerbach, professor of economics and law at University of California Berkeley and director of the Burch Center for Tax Policy and Public Finance there. He also served as deputy Chief of Staff of the Joint Committee on Taxation.

From Tom’s Reading List

Politico: Tim Cook Defends Apple Tax Policy — “Apple CEO Tim Cook on Tuesday vigorously defended his company on Capitol Hill against charges that the tech company stashes billions of dollars overseas to lower its U.S. tax bill. In his first appearance before Congress, Cook told a Senate investigative committee that the company is a leading U.S. taxpayer that’s generated thousands of new jobs. And he countered that the U.S. Tax Code itself is faulty because it hamstrings ‘American corporations in relations to our foreign competitors.'”

Bloomberg Businessweek: Google Joins Apple Avoiding Taxes With Stateless Income — “Google, for example, has used a pair of tax shelters known by tax attorneys as the ‘Double Irish’ and ‘Dutch Sandwich’ that move foreign profits through Ireland and the Netherlands to Bermuda to avoid about $2 billion in income taxes a year, according to the company’s filings in the U.S. Like Apple, Mountain View, California-based Google shifts profits into an Irish subsidiary that doesn’t pay taxes in Ireland. In Google’s case, it says the unit is managed in Bermuda, which has no corporate income tax.”

Slate: Scrap The Corporate Income Tax — “If you’re bothered about companies like GE, scrap various tax breaks. If you’re worried about companies paying high rates, lower the rate. If you’re annoyed about Apple, go after foreign accounts. But looking at them all simultaneously suggests an alternative to reform. Just give up. Though the corporate income tax as presently constructed supports a small army of accountants, tax lawyers, lobbyists, and CNBC talking heads, it doesn’t raise very much revenue.”

The Economist: Tax Havens: The Missing $20 Trillion  — “Getting rich people to pay their dues is an admirable ambition, but this attack is both hypocritical and misguided. It may be good populist politics, but leaders who want to make their countries work better should focus instead on cleaning up their own back yards and reforming their tax systems.”

Tweets From During The Show

Please follow our community rules when engaging in comment discussion on this site.
Oct 5, 2015
The newest version of the Apple mobile iOS system allows ad-blocking software on mobile browsing for the first time. (Abdullah Syahbal / Flickr)

Are ad–blocking, bots, and mobile gutting economic viability of the internet? We’ll take a close look.

Oct 5, 2015
Singer-songwriter Sara Barielles on the cover of her new memoir, "Sounds Like Me." (Courtesy Simon & Schuster)

Singer-songwriter Sara Bareilles goes fully confessional in her new memoir, “Sounds Like Me.” She joins us.

Oct 2, 2015
Max Martin accepts the award for best producer of the year, non-classical at the 57th annual Grammy Awards on Sunday, Feb. 8, 2015, in Los Angeles.  (AP)

The software of hit songs now. We’ll look at the algorithms, computer generated beats and producers making it happen for Taylor Swift, Katy Perry, and more.

Oct 2, 2015
Candles spelling UCC for Umpqua Community College, are displayed at a candlelight vigil for those killed during a fatal shooting at the school, Thursday, Oct. 1, 2015, in Roseburg, Ore. (AP)

A deadly shooting at an Oregon community college. Putin and Obama at the UN. The capture of Kunduz. Water on Mars. Our weekly news roundtable goes behind the headlines.

On Point Blog
On Point Blog
Our Week In The Web: October 2, 2015
Friday, Oct 2, 2015

We say hello again to our email address (since so many of you did this week) and goodbye to the Log Lady.

More »
Interview With Sen. Bernie Sanders: ‘Count Me As A Radical’
Thursday, Oct 1, 2015

Vermont Sen. Bernie Sanders is making waves in the 2016 Presidential race, and he joined us today from the US Capitol to explain how his campaign message is connecting with voters around the country.

More »
Our Week In The Web: September 25, 2015
Friday, Sep 25, 2015

But seriously — where ARE our podcasts running off to? Plus, more Jewel.

More »