Simon Collins is the Herald’s education reporter.

US Apple users urge company to 'do the right thing' and pay NZ taxes

Apple is the biggest taxpayer in the US but paid zero tax in NZ in the past decade
Apple is the biggest taxpayer in the US but paid zero tax in NZ in the past decade

American-based Apple users are weighing in behind Kiwi politicians who are calling for the US tech giant to pay its taxes in New Zealand.

Bryan Chaffin of The Mac Observer, an Apple community blog site founded in 1998, has urged Apple chief executive Tim Cook to "do the right thing" even though it would mean slightly lower profits for the company's shareholders.

He was commenting on revelations today in the Weekend Herald that Apple paid zero tax to the NZ Government in the past 10 years in a period when its sales in this country totalled $4.2 billion.

The company's accounts show that its NZ branch paid $37 million in tax since 2007 - but all of it was passed on to the Australian Government because the NZ operation is run out of Australia.

Chaffin wrote that Apple was the largest taxpayer in the United States, but "pays next to nothing in most parts of the world".

"There are so many areas where Apple does enormous good - far, far more good than any other electronics giant, and probably any other for-profit company," he wrote.

"But local taxes matter. Roads matter. Schools matter. Housing authorities matter. Health care matters. Regulation enforcement matters. All of the things that support civil society matter. Apple's profits are made possible by that civil society, and the company should contribute its fair share.

"According to the New Zealand Herald, 'Had Apple reported the same healthy profit margin in New Zealand as it did for its operations globally it would have paid $356 million in taxes over the period.'

"That kind of money matters to countries the size of New Zealand. To me, Apple should kick in to help pay for the civil infrastructure it needs to make those profits.

"And I won't be silent about it."

Labour's revenue spokesman Michael Wood said Kiwi taxpayers had "every reason to feel outraged" by Apple's zero NZ tax bill.

"Nurses, cleaners, office workers, and small business owners, who pay their fair share of tax to support public services in our country, will be dismayed at these latest revelations," he said.

"We know that this is the tip of the iceberg for big multinationals being let off the hook by the National Government being completely asleep at the wheel."

On March 3 the Government announced a package of measures which will deem non-residents to have NZ permanent establishments if they sell goods or services to a person in New Zealand, and have related entities carrying out activities here to bring the sales about.

The package will also stop companies using interest payments to shift profits offshore. But it stops short of a diverted profits tax which has been introduced in Australia and Britain.

Revenue Minister Judith Collins declined to comment specifically on Apple yesterday, but said a "minority" of international companies were exploiting rules to avoid paying tax and "we do not consider the amount of tax paid by these multinationals is fair".

An Apple spokesperson in Australia told the Weekend Herald yesterday: "Apple aims to be a force for good and we're proud of the contributions we've made in New Zealand over the past decade. Because our products and services are created, designed and engineered in the US, that's where the vast majority of our tax is paid."

- NZ Herald

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