This space is reserved for my own personal rants.
Corporate Taxes, May 22, 2013
It was recently announced that Apple, one of America's largest and most profitable companies did not pay any United States taxes in 2012. This has everyone in Congress up in arms and conducting hearings on how they got away with it. This is similar to Warren Buffet declaring that he pays a smaller percentage of taxes than his secretary. Mr. Buffet believes this is not right. My friends and I have engaged in this debate, so I'll give you my two cents here.
My short response is, "Change the law, or send the IRS more than you are required to, but quit fussing about it." As long as Apple and Mr. Buffet are paying the legal amount of taxes owed, I'm fine with it. If they, or you, don't like the amount of taxes they are required to pay, then change the law. Otherwise, I'm sure the IRS will accept your gift of additional money if you feel like you need to make it right.
I'm sure Apple and Mr. Buffet paid the appropriate amount of tax. I'm also sure that they took advantage of the tax law to shield income and take advantage of tax credits as appropriate. Is this wrong? No, it is not wrong. It is legal and supports a law that was created by Congress, approved by the majority and later signed into law by the President and supported by the Judicial branch. If you don't approve of the law that allows Apple, Mr. Buffet and you to take advantage of the tax law, then change it. But, don't begrudge them for using it.
I have a dear friend with two beautiful girls. I don't have any children. Should I be upset that he gets a child dependent deduction that I can't take advantage of? No, because it's the law. If I don't like it, then I should change the law. Congress is crying foul to Apple for taking advantage of a system they created.
What we are all saying is that tax loopholes exist that should be closed. Closing enough loopholes would required Apple, Mr. Buffet and you to pay a larger portion of taxes and thereby, make it right in people's mind. Congress has to fix this, and only we can fix Congress. If you don't like this situation then do something about it.