First of all, lots of people don’t like paying tax. Neoliberals and conservatives in particular seem to have massive issues with tax, although they seem to have no problem driving on the roads those taxes paid for, being cared for by public medical services or taking advantage of public education, or at least of education subsidies paid on their behalf from tax revenue so their little darlings can benefit from private school educations that advantage the advantaged.
But that’s partly what I find so odd about Apple apparently paying ‘no’ tax in New Zealand: Apple has a reputation for supporting democrats, standing up for equality and strongly pursuing sustainability ambitions. None of these are exactly ‘neoliberal’.
However, Apple is also a rapacious US corporation with its eye firmly on profit. Apple will do almost anything to defend its interests, ruthlessly cut product lines and teams that don’t satisfy this urge for ever more money and, seemingly, exploit any avenue that leads to even more money on the extremely wealthy corporation’s bottom line.
But what’s the truth about Apple and New Zealand tax? Sure, Apple makes money in New Zealand. It’s a tiny territory and hardly a big factor in Apple profits, although New Zealand has always been relatively high in Mac use, then iPhone adoption.
But ‘Apple New Zealand’, although it has an office in Auckland and staff on the ground here, is actually run out of Sydney, Australia as part of ‘Apple Pacific’ which, in turn, reports directly back to Cupertino (or at least, this was the case last I heard). So Apple pays its tax in Australia, and not New Zealand. This actually means Apple pays more tax, not less: if Apple operated this subsidiary out of New Zealand it would be paying tax at 28%, but because it’s based in Australia, it’s subject to tax at 30%, as Seamus Coffey asserts.
Look, I’m not advocating tax avoidance – in fact, it makes me sick to the stomach. You choose to live in a society, and you pay your dues, as far as I’m concerned. And if I can pay tax on my tiny income, Apple can pay tax on its massive one.
Of course, corporate tax is paid on profit, not sales (apart from the New Zealand Goods and Services Tax or GST, which Apple does pay even on online sales).
Apple has not paid any income tax in New Zealand for the last ten years in New Zealand, but it has paid out $37 million from NZ sales to the Australian Tax Office instead of to New Zealand’s Inland Revenue.
But the issue is being ‘investigated’ by National minister Judith Collins. You know, the one whose husband runs Oravida, which is making millions out of selling free New Zealand water by bottling it and moving it overseas. So yeah – kettle, pot, black …
Of course, none of this excuses Apple from its tax avoidance elsewhere. That totally sucks.