ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Apple Corporation is a Primer for How US Business Avoids Taxes

Updated on April 30, 2012

How does Apple and others like it reap billions? Avoid paying millions in taxes legally. Apple for instance, avoids millions in Calif. taxes by having a small 12 person office in Reno, Nevada, under the name Braeburn Capital. It does not manufacture any products in the state. Although based in Cupertino, CA, near San Jose, its dinky Reno office collects and invests the company's profits and thereby avoids California income tax on some of its gains. With a corporate tax of almost 9%, Nevada is a bargain at 0%.

Apple, like others, creates subsidiaries in low tax countries such as Ireland (Medtronics is also there), the Netherlands, British Virgin Islands. all help cut taxes. Many of these offices are tiny. If you buy any Apple product in the USA, part of the profits go into accounts controlled by Braeburn, which is then invested in stocks or other and profits from them are exempt from Calif. taxes because of the Nevada address. Since 2006, Apple has earned $2.5 billion in interest alone from cash reserves and investments.

Apple avoids taxes owed to the US government by having small offices around the globe in friendly low tax countries. Whenever anyone downloads an Apple anything in Europe, Africa or Mideast, the sale is recorded in a 24 person office located in Luxembourg called iTunes By doing so, the country gives a low tax rate. How much? According to 2011 documents, this small office reaped $1 billion, which represents 20% of iTunes sales. Downloading anything is the least taxed. Apple, like others, are masters at tax loopholes, such as their "double Irish with Dutch sandwich".

This reduces Apple's taxes by routing profits through two Irish firms called, Apple Operations International and Apple Sales International, then through the Netherlands and finally through an office in the Caribbean. Ireland, although is only five million people, reaps 33% of Apple's revenues.

Had Apple not exploited the loopholes, it would have had to pay a total of $2.4 billion in taxes to the US government. Apple accountants have found ways to attribute that 70% of its profits are outside the USA, although tax experts believe that is all smoke and believe that most of Apple's sales are in the US.

I think the corporate tax code needs to be updated to the 21st century.


    0 of 8192 characters used
    Post Comment

    No comments yet.


    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)