As a geeky tax attorney, I’ve been fascinated by the Senate committee hearing for Apple Inc.’s international tax planning strategies. Over the last few days, these strategies have been called: “unpatriotic,” “shenanigans,” “baroque tax avoidance strategies,” “gimmickry,” “scandalous,” “wrong or unjust,” and (even) “illegal.” Just to set the record straight, from what I’ve read, Apple has done nothing illegal. Apple is merely practicing sophisticated tax avoidance which is perfectly acceptable under our current tax code. In fact, poor Apple is being vilified for doing what most Americans would (and do) given the opportunity.
As many of the news articles point out, Apple is not the only tech company (and certainly not the only multinational company) engaging in these activities. But, Apple may be one of the most admired and well-respected companies using these tactics. Heck, Apple may be the most esteemed and well-regarded public company PERIOD. In my opinion, that is the reason Apple was hauled into the Senate committee hearing in the first place.
Here is the thing that burns me most about this hearing and its media coverage – once again, Congress is pointing and shaking fingers at the taxpayer, when the true responsibility rests on the doorstep of the Capitol building. Our elected officials who are all too happy to soil Apple’s reputation and good name are also the only people with the power to change the laws that enable Apple (and countless other multinational companies) to avoid taxes in this manner. I’m a huge proponent of fairness, and this does not seem fair to me. Congress should not be able to write the rules of the game and then blame the players for using those rules to their greatest advantage. I mean, really, who doesn’t want to pay less tax?