Apple Taxation

Apple NZ has paid no tax in New Zealand for over a decade. It pays tax in Australia instead. There is no suggestion that Apple has broken any laws. The story has been covered in both the UK, in The Guardian, and in New Zealand, by Stuff. Incidentally, most of Apple’s profit in Australia and New Zealand is diverted to Ireland.

What caught my eye in this story was the response of Deborah Russell, a senior lecturer at Massey University’s school of accountancy in Palmerston North in New Zealand. She expressed the view that it would be surprising if the New Zealand government could compel Apple to pay tax in New Zealand, saying; “I think Apple is bigger than New Zealand – they’ve got tremendous resources to fight back. Every time a government comes up with a new way to rein in these multinationals, clever tax accountants come up with a way around it. That’s essentially their job.”

Really? The UK is hamstrung for now by its membership of the European Union. However New Zealand ought to be able to require any company to pay tax on it New Zealand business. If they avoid tax on their profits, through any one of a range of profit/cost transfer schemes, then it would be relatively simply to tax them on their sales in New Zealand.

Let’s hope Ms Russell’s views are not shared by the New Zealand government and, indeed the UK government in due course. If governments start with a supine and defeatist attitude, the multinationals will continue to ride roughshod over the best interests of the societies within which they operate.

Leave a Reply

Your email address will not be published. Required fields are marked *