This week the U.S. Senate brought Apple executives before one of its publicly held sub-committee hearings. The topic was Apple using Ireland and other techniques to avoid paying U.S. taxes on products and services sold off-shore. Among all the Congressional hubris that took place, one big fallacy remains: Corporations do not pay taxes, we do.
For every dollar or tens of dollars taxed and regulated onto companies, whether it be Apple, Coke or Bob's Deli, we pay those costs. In reality, companies pay zero taxes, as they simply pass those costs down the line to the consumers of their products. Thus, we pay every dime of every regulation and tax bestowed onto corporations, every – single – dime.
The Federal Government has made us more than aware of how many calories we eat at McDonalds, or how much high fructose corn syrup there is in our cereals, but how about they start showing us what they would never want to expose? How about a few new rows on our products revealing government imposed costs:
- Row 1: Regulation Cost. This would show how much in terms of USD the Federal Government has added to a product's cost, and also shown in terms of a percentage of the retail price.
- Row 2: Tax. How much tax in USD is imbedded into the cost of the product, and its percentage of the total product cost.
- Row 3: Total Federal Costs: The total cost of regulations and taxes levied upon the products overall price, shown in USD and as an overall percentage of the retail price of the product.
This might not be as shocking as people getting paid their actual pay checks, and then being forced to write checks back to the government each month for the taxes owed on their earnings (that would likely cause an all-out Government collapse, or revolt... or perhaps both at the same time), but this would certainly shock people. Exposing the tax burden on all the products we buy would begin to give the populous an understanding of where their money is going, and how much regulation and overall cost is being imposed upon every product on the market.
There are countries who are taking advantage of, nor care about, how to improve processes, or responsibly use their resources, due to the fact it is simply cheaper not to do so. But all the more, consumers are making stands, lawsuits are filed, and as a result companies are making decisions on how to manufacture, where to manufacture, and how to best deliver products to their customers. Meanwhile, the Government falls woefully behind the pace of competition and free market delivering solutions to these issues.
While attempting to grill Apple (for following the law no less), the illustrious Senators revealed the tax code they are working with is from the 1980's, and it really needs an overhaul. Rather than expose Apple, these politicians revealed all the more how truly incompetent they are at affecting change. Oddly enough they seem to mange their campaigns with great efficiencies, enough so to be re-elected time and time again. Funny how that happens...
And in the cross-hairs we find Apple, getting grilled on taxes. Apple pays over $16 million in US taxes a day, and represents 2.5% of the Government's overall tax revenue per year. Yet some in Congress believe Apple should somehow pay much more than that. What does that really mean? When the politicians get the public to shake their angry fists at Apple (perhaps even you), just know every additional tax dime successfully legislated onto One Infinite Loop is really just a pass through. We the consumer will pay every dime of new taxes levied against the most successful company our country has ever known.
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