MUST READ: Silicon Valley Mercury News published our op-ed
American technology giant Apple was recently under fire from the
media and Congress when it was revealed that the company is effectively
lowering its tax burden by keeping profits out of the U.S. Instead,
Apple is parking them in countries with much lower or no corporate tax
rate. While many are incensed that the world's most profitable
technology company pays such a low rate, Apple has done nothing wrong
and is only adapting an unusually high and jumbled tax code that we have
created in the U.S.
The cure is to lower the U.S. corporate
tax rate, the highest in the world, and to simplify the tax code. We
wanted to share with you an op-ed that the Silicon Valley Mercury News published today from our Chief Strategist Sal Russo.
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Apple and tax reform: Controversy should provide incentive for Silicon Valley to join the tea party
By Sal Russo, 05/29/2013
Silicon
Valley has been a phenomenal success story in almost every way, and
sometimes that can breed a feeling that good times will go on forever.
The tea party movement has not found a lot of Valley support in its
efforts to scale back the size, cost and intrusiveness of the federal
government. But perhaps the attack on Apple's tax avoidance strategy
will serve as a wake-up call to the tech community.
Apple CEO Tim
Cook's call for corporate tax reform was music to the ears of tea
partiers. His company is illustrating a basic truth: When taxes get too
high, people will avoid paying them either by using tax avoidance
strategies, as Apple has done, or by not producing more goods and
services that consumers want. All of it is bad for economic growth and
provides fewer opportunities for American workers.
Apple's
success has been defined by its simple, intuitive designs. It is too bad
the same can't be said about the U.S. federal tax code. There is
nothing sleek and sexy about the 73,954 pages of complex jargon that
incentivizes offshore stashes and encourages the type of crony
capitalism that gives favors to special interests.
Presidents
John Kennedy, Ronald Reagan and Bill Clinton all supported lower tax
rates; the wisdom of lower rates should be indisputable. Unfortunately,
President Barack Obama has shown no interest in meaningful tax reform,
only in his policy of high tax rates and special favors for industries
or companies he
favors.
That's why it's mind-boggling that
employees of companies like Apple have supported Obama so
overwhelmingly, even as his policies have impaired economic growth.
During the 2012 election cycle, 87.3 percent of contributions from Apple
employees to presidential candidates went to Obama - a total of
$307,831.
Obama is happy to keep spending more money, raising
more taxes, passing more regulations and promoting unsustainable
increases in the national debt. Despite the results of these policies --
inhibiting economic growth and profitability -- Silicon Valley has
unfortunately been loyal with its votes and money.
It is hard to
make a strong case that Apple should pay the United States' exorbitant
tax rates when the company can park its money overseas and pay limited
taxes. The U.S. corporate tax rate is a whopping 35 percent. That is the
highest in the world, and it is also 10 percentage points higher than
the 34-nation Organization for Economic Cooperation and Development
average.
If U.S. tax policy encouraged repatriation of overseas
profits, some of those dollars would provide more in government revenue
and, most importantly, give more generous rewards to shareholders. Think
of what those billions of dollars sitting overseas could do to help
these companies and our economy grow. Sen. Rand Paul was correct to put
the blame on Congress, not Apple, for poor policies.
A 2011 New
America Foundation study advocated the reduction of the corporate tax
rate on repatriated profits to create an economic boost. The study
estimated that the policy would result in 1.3 million to 2.5 million new
jobs and an increase of $36 billion in federal tax revenue.
With
anemic economic growth and crippling debt, it is hard to imagine that
the public and private sectors cannot come together to demand this kind
of change.
This is a good time for Silicon Valley to wake up and
join the tea party in advocating for fundamental tax reform. Big and
intrusive government with high taxes does not work if you want economic
growth and opportunity for our people.
Sal Russo is chief strategist for Tea Party Express.
Read article on Mercury News website |
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Tea Party Express is working hard to offer common sense solutions to
real world problems. When we apply our shared fiscal conservative ideas
to real world situations, it helps people understand what we are
fighting for. That is how we are going to win people over to Tea Party
principles and combat the negative stereotypes that the left and
mainstream media have pushed on the American people.
If
you agree with us and would like to see us continue to fight for our
ideas and solutions, please consider making a donation today. We can't
do it without your support!
Now
that we FINALLY have the attention of the mainstream media, we need to
take advantage of it and continue to make the case that higher taxes and
over-regulation is hurting our economy and stifling growth and
prosperity in the U.S.
We here at the Tea Party Express are guided by our motto "Restore Liberty - Honor the Constitution" and 6 basic principles:
o No more bailouts
o Reduce the size and intrusiveness of government
o Stop raising our taxes
o Repeal Obamacare
o Cease out-of-control spending
o Bring back American prosperity
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