U.N. could tax U.S.-based Web sites, leaked docs show

Global Internet tax suggested by European network operators, who want Apple, Google, and other Web companies to pay to deliver content, is proposed for debate at a U.N. agency in December.

To read the article, click the link below:

http://news.cnet.com/8301-1009_3-57449375-83/u.n-could-tax-u.s.-based-web-sites-leaked-docs-show/?tag=mostPop

Apple and Taxes

Apparently, Steve Jobs was not one of those individuals who felt he was not being taxed enough!

Video from CNBC (6:59)

To view video, click the link below:

http://video.cnbc.com/gallery/?video=3000087263&play=1

Apple’s Tax Strategy Aims at Low-Tax States and Nations

The following is an excerpt from an article in 

The New York Times
Sunday, April 29, 2012

Apple’s Tax Strategy Aims at Low-Tax States and Nations 

By CHARLES DUHIGG and DAVID KOCIENIEWSKI

RENO, Nev. — Apple, the world’s most profitable technology company, doesn’t design iPhones here. It doesn’t run AppleCare customer service from this city. And it doesn’t manufacture MacBooks or iPads anywhere nearby.

Yet, with a handful of employees in a small office here in Reno, Apple has done something central to its corporate strategy: it has avoided millions of dollars in taxes in California and 20 other states.

Apple’s headquarters are in Cupertino, Calif. By putting an office in Reno, just 200 miles away, to collect and invest the company’s profits, Apple sidesteps state income taxes on some of those gains.

California’s corporate tax rate is 8.84 percent. Nevada’s? Zero.

Setting up an office in Reno is just one of many legal methods Apple uses to reduce its worldwide tax bill by billions of dollars each year. As it has in Nevada, Apple has created subsidiaries in low-tax places like Ireland, the Netherlands, Luxembourg and the British Virgin Islands — some little more than a letterbox or an anonymous office — that help cut the taxes it pays around the world.

Almost every major corporation tries to minimize its taxes, of course. For Apple, the savings are especially alluring because the company’s profits are so high. Wall Street analysts predict Apple could earn up to $45.6 billion in its current fiscal year — which would be a record for any American business.

Apple serves as a window on how technology giants have taken advantage of tax codes written for an industrial age and ill suited to today’s digital economy. Some profits at companies like Apple, Google, Amazon, Hewlett-Packard and Microsoft derive not from physical goods but from royalties on intellectual property, like the patents on software that makes devices work. Other times, the products themselves are digital, like downloaded songs. It is much easier for businesses with royalties and digital products to move profits to low-tax countries than it is, say, for grocery stores or automakers. A downloaded application, unlike a car, can be sold from anywhere.

The growing digital economy presents a conundrum for lawmakers overseeing corporate taxation: although technology is now one of the nation’s largest and most valued industries, many tech companies are among the least taxed, according to government and corporate data. Over the last two years, the 71 technology companies in the Standard & Poor’s 500-stock index — including Apple, Google, Yahoo and Dell — reported paying worldwide cash taxes at a rate that, on average, was a third less than other S.& P. companies’. (Cash taxes may include payments for multiple years.)

Even among tech companies, Apple’s rates are low. And while the company has remade industries, ignited economic growth and delighted customers, it has also devised corporate strategies that take advantage of gaps in the tax code, according to former executives who helped create those strategies.

Apple, for instance, was among the first tech companies to designate overseas salespeople in high-tax countries in a manner that allowed them to sell on behalf of low-tax subsidiaries on other continents, sidestepping income taxes, according to former executives. Apple was a pioneer of an accounting technique known as the “Double Irish With a Dutch Sandwich,” which reduces taxes by routing profits through Irish subsidiaries and the Netherlands and then to the Caribbean. Today, that tactic is used by hundreds of other corporations — some of which directly imitated Apple’s methods, say accountants at those companies.

Without such tactics, Apple’s federal tax bill in the United States most likely would have been $2.4 billion higher last year, according to a recent study by a former Treasury Department economist, Martin A. Sullivan. As it stands, the company paid cash taxes of $3.3 billion around the world on its reported profits of $34.2 billion last year, a tax rate of 9.8 percent. (Apple does not disclose what portion of those payments was in the United States, or what portion is assigned to previous or future years.)

By comparison, Wal-Mart last year paid worldwide cash taxes of $5.9 billion on its booked profits of $24.4 billion, a tax rate of 24 percent, which is about average for non-tech companies.

Accenture Awarded Website Consolidation Contract from the I.R.S.

February 09, 2012

Accenture Awarded Website Consolidation Contract from the I.R.S.

Initial work focuses on ease of use for IRS.gov

RESTON, Va.; Feb. 9, 2011 –The Internal Revenue Service (IRS) has awarded Accenture Federal Services a 10-year contract to redesign, develop and manage three IRS portals. The work will consolidate the consumer-facing website, IRS.gov, the registered-user portal for tax preparers and the agency’s employee intranet. The new infrastructure will make it easier to do business with the IRS by streamlining, updating and combining processes for ease of use.

Initial work will focus on design, infrastructure, architecture and operations of IRS.gov, one of the nation’s most trafficked websites with more than 2 billion page views each year. Work also includes content management, web search engine optimization, user analytics and site security.

“The IRS strategy has been to leverage resources wisely to create the greatest operational efficiencies and continue to deliver trusted online resources where taxpayers find what they need to effectively meet their tax responsibilities,” said Craig Cornelius, who leads Accenture’s federal civilian agency portfolio. “The changes to the portals will add new online capabilities and help to improve service options for American taxpayers.”

This contract award is the most recent win in a string of successful projects that highlightAccenture's work with the IRS, including payment processing and fee accounting. Accenture continues to assist with the IRS’ Return Preparer Registration program, providing a secure online registration and renewal process for tax preparers and filers.

Accenture’s federal business serves every cabinet-level department and 20 of the largest federal organizations. The U.S. federal portfolio spans across clients in civilian, defense, intelligence and public safety agencies.

Learn more about Accenture’s work with federal agencies and delivering Public Service of the Future.

About Accenture

Accenture is a global management consulting, technology services and outsourcing company, with more than 244,000 people serving clients in more than 120 countries.  Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments.  The company generated net revenues of US$25.5 billion for the fiscal year ended Aug. 31, 2011.  Its home page is www.accenture.com.

# # #