Mayor of Cupertino Clashes with Tax-Dodging Apple: Company 'Abuses Us'

Apple Computer and the city of Cupertino where it is headquartered have had tumultuous relationship, going back decades. But relations have gotten perhaps their most strained in a growing dispute over taxes that Apple pays.

Business insider cites research that:  "Apple paid $9.2 million in taxes to Cupertino from 2012 to 2013. In the 2012 fiscal year, Apple made $156.5 billion in sales. Cupertino gives Apple an  annual tax break  on business-to-business sales that started in 1997, when Apple was on the verge of collapse."

The mayor of Cupertino, Barry Chang, told the Guardian: “In the meantime Apple is not willing to pay a dime. They’re making profit, and they should share the responsibility for our city, but they won’t. They abuse us.”

Chang is currently not even allowed on the Apple grounds. "[The Cupertino Mayor] hoped to have a meeting to talk about traffic congestion [but] Barry Chang barely made it into the lobby when Apple’s security team surrounded and escorted him off the property," the Guardian reported. “They said ‘you cannot come in, you’re not invited.’ After that I left and have not gone back,” Chang said.

Apple is the largest employer in the Cupertino, and on the brink of completing a $5 billion new campus in the city. But according to Business Insider,"Cupertino gives Apple an annual tax break on business-to-business sales that started in 1997, when Apple was on the verge of collapse."

But a recent study based on SEC filings showed that "Apple holds $181.1bn in offshore profits, more than any other US company, and would owe an estimated $59.2bn in taxes if it tried to bring the money back to the United States."

“[Apple is] not willing to pay a dime. They’re making a profit, and they should share the responsibility for our city, but they won’t,” Chang told The Guardian. “They abuse us.”

That's a sharp contrast compared with mayor's tone earlier this year. While wary of Apple's new project, Chang spoke about the potential benefits the new campus could have for the community in his state of the city address earlier this year.

“The world is watching the Apple Campus II project. You may want to know where it stands," the Cupertino mayor told the audience. "I visited the jobs site a couple of months ago and an Apple senior executive told me it will be finished on schedule, by the end of the year. And this building will be one of the most green buildings on earth. And other good news - Apple will have a very special Apple Store in Cupertino. You can go up to the second floor and peek into the Apple Campus."

But a major part of Cupertino's expenditures are on road maintenance, which Apple could arguably chip in a lot more for. "We have a reserve of about 46.5 million dollars, " Chang said. "However, if we don’t watch carefully, it can be wiped out in just a single big item  - for example - to build a brand new Civic Center will cost us about $70 million which would put us in debt and leave no money for other important items such as providing free shuttle bus service and making our bike lanes safer." Apple’ Campus II employs more than 14,000 - more than any individual company. Even if Cupertino had the land and taxpayer dollars to build a new highway lane in each direction - the cars from just that tech campus are more than enough to fill it.

“There will be lots of excitement and I encourage all of our residents to be informed and do the right thing," Chang concluded.


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