AppleInsider Staff
Former U.S. Sen. John E. Sununu authored a newspaper column on Monday blaming the United States Congress, and not Apple, for policies that allow corporations to avoid American taxes.
Sununu, a one-term Republican Senator from New Hampshire, is now a columnist for the Boston Globe. In a piece published on Memorial Day, the former politician blasted members of the U.S. Senate Permanent Subcommittee on Investigations for singling out Apple on taxes when the company is following the laws as written.
John Sununu served as Representative and Senator for New Hampshire from 1997 to 2009.
Apple Chief Executive Tim Cook was called before the subcommittee to explain why Apple has $100 billion in cash overseas. Most of that money is kept through subsidiaries in Ireland, which allows Apple to avoid billions of dollars in repatriation taxes if those funds were to be brought back to the U.S.
The current tax rate for bringing overseas cash back to U.S. shores is 35 percent, one of the highest tax rates of its kind in the world. Cook argued before the subcommittee that a dramatic revision of the U.S. tax code is necessary to address that issue.
"Making the case for his company's decisions, Cook came off far better than the average witness on Capitol Hill," Sununu wrote in his column. "Perhaps it's easier to be blunt when you employ 60,000 workers in the United States, but lines like 'we pay all the taxes we owe — every single dollar' set the tone from the start.
"In public and private sector alike, a defensive posture makes people think you have something to hide. Cook's confidence contrasted dramatically with IRS managers pleading the Fifth before Congress the very next day."
In Sununu's eyes, the blame for companies like Apple sheltering their funds overseas lies on Congress, which originally wrote the tax laws and has failed to update them to resolve these concerns. Other major American companies, including Google and Yahoo, also avoid paying U.S. taxes with subsidiaries in Ireland — and some go even farther than Apple with holdings on Caribbean islands or bank accounts in the Cayman Islands.
Sununu joins U.S. Sen. Rand Paul (R-Ken.), who serves on the Senate committee that questioned Apple Chief Executive Tim Cook on his company's tax practices. During the hearing, Paul criticized his colleagues for "bullying, badgering and berating" a great American success story when Apple has broken no laws.
"We should have brought in here today a giant mirror, so that we can look at the reflection of Congress, because this problem is created by the awful tax code," Paul said.
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38 Comments
Couldn't agree more with these guys. The tax code seems to be written in a way to make things flexible. It is the corporation's duty to "maximize shareholder wealth" so not using any legal means to reduce tax burden is not due diligence. If congress doesn't want companies doing this, then they need to simplify the tax code (as Tim Cook is proposing). They go through all these hoops to appease their lobbyists and then get upset when other companies (probably the ones not spending money on lobbyist) use it to their advantage. This is government corruption plain and simple. Pay your corporate "dues" to government officials, or we will put you on the stand like commies. Absolutely ridiculous.
Senator: The senate and the incompetent laws we produced while I was a part of it are the problem.
This is just all looking more and more like a pretense to give these companies a 'tax holiday' or big break to get offshore money back into the US. It sounds great if you're willing to overlook that it is money that they didn't pay taxes on in the US in the first place. If they are are supremely incompetent they will go along and then be surprised at the wave of increased offshoring that occurs. If you can pay low taxes on profits artificially made overseas and then bring that money into the US with little or no penalty- why would anyone be dumb enough to report profits inside the US?
If they are going to do that, they should just take it to its logical conclusion and be done with it. Set the corporate tax rate in the US to 0. Corporations already pay under 7% of what our government spends in a year. Just set it to 0, keep the money made in the US in the US, and we can stop pretending they are contributing their 'fair share'
The morons and un-American politicians that are blaming Apple for not paying their "fair share" are the ones that are responsible for the ridiculous tax laws to begin with. The tax laws are a mess because of them and they themselves are to blame. Do these people not take any responsibility for their own actions? Don't answer that, because I already know the answer.
How dare they call in Apple to be questioned for merely following the law. Do these hypocritical thugs who criticize Apple pay more than they should when filing their own taxes? No? Well, then they should STFU.
And this doesn't just apply to Apple, but it applies to any company or person that follows the current tax laws. As long as it's legal, then there is nothing to talk about really. Who are these communists and fascists to decide what somebody else's "fair share" is? If we're deciding what's fair, then we should open up a few gulags in Alaska or someplace else that's cold, and send these politicians there, because that sounds fair to me.
With the way that the incompetent baboons in the government spends our money, I'd say that the less money that you give the Feds, the more patriotic you are and the less the govt can waste, spend and steal.
Agree. I am a republican and I am so tired of John McCain's mouth on this subject. At least the other Republican and Democratic senators are outspoken over how their colleagues are taking Apple for obeying all the laws. Especially when all the government wants is more money to squander away on Electric vehicle companies and dummy healthcare. At least Apple is a company that is over $1 billion to the good unlike the government who spends millions everyday that they don't have. In the words of ESPN's Chris Carter..."C'mon man!!"
[quote name="AppleInsider" url="/t/157708/former-us-senator-pens-defense-of-apples-international-tax-strategy#post_2333707"]"Making the case for his company's decisions, Cook came off far better than the average witness on Capitol Hill," Sununu wrote in his column. "Perhaps it's easier to be blunt when you employ 60,000 workers in the United States, but lines like 'we pay all the taxes we owe ??every single dollar' set the tone from the start. "In public and private sector alike, a defensive posture makes people think you have something to hide. Cook's confidence contrasted dramatically with IRS managers pleading the Fifth before Congress the very next day.".[/quote] I know there are a number of Cook critics around, but the more I see of him, the more impressive he is. He's not Jobs - nor should he be. The situations were different. Jobs was a visionary and had to save a struggling company - and put it on the path to greatness. Cook inherited a great company and has to manage that. And even if their situations were the same, there's nothing wrong with different personality types running a company. Expecting two CEOs to have the same style is silly. It's larger than any other public company in the world - and needs to be managed like a large company, not an entrepreneurship. Cook has done a great job of managing a large, complex, profitable company and it's good to see him getting some of the recognition he deserves.