MediaFile

Do tech giants really need a tax holiday?

By Kevin Kelleher
The views expressed are his own.

I want a new MacBook Pro. And I’d really love to buy one. But Apple won’t let me.

It’s not that I can’t afford it – the cash is just sitting there in my account. And it’s not that I don’t want Apple to have the money. I’d love to do my share to create jobs at One Infinite Loop or to reward Apple shareholders for their faith in the company’s impressive profit growth. No, Apple won’t let me buy a Macbook Pro because it expects me to pay $2,500. And I simply don’t want to pay that much, so I’m asking Apple to lower the price. And they should accept that; after all, $500 is better than $0.

I even went into an Apple store and asked the blue-shirted genius who greeted me if Apple would part with a 17-inch Macbook Pro for $500. He looked at me like I was crazy. Which is pretty much what I expected, but I figured I had a shot. Because I was simply following the example set by Apple and other big-cap, cash-rich tech giants who have done an end-run around tax laws. If Apple can ask for a tax holiday to bring its overseas profits home, why can’t I ask for a Macbook holiday so I can bring a new laptop home?

The genius was probably right. It is silly to insist that you pay less than your fair share. But that’s not stopping Apple, Google, Cisco, Microsoft, Oracle, EMC Adobe, Qualcomm and other companies and trade groups from lobbying hard for a tax holiday. Corporations in the biotech and energy sectors are also on the bandwagon, but the strongest push is coming from Silicon Valley.

U.S.-based multinationals hold an estimated $1.4 trillion in profits in overseas accounts. Apple alone has $82 billion in cash and marketable securities, two thirds of it held in offshore accounts. Google has $43 billion in cash and marketable securities while Microsoft has $57 billion, Cisco $46 billion and Oracle $32 billion. Many of these companies have expressed an interest in bringing overseas cash to the U.S., except they think the tax rate is too high.

Tech wrap: Google’s appetite for local grows with Zagat buy

Google bought Zagat, the popular dining recommendations and ratings authority, jumping into a niche Web market alongside the likes of OpenTable and Yelp. The 32-year-old Zagat, which polls consumers and compiles reviews about restaurants around the world, will become a cornerstone of Google’s “local offering” and work in tandem with its mapping services and core search engine, the Internet search and advertising leader said.

The Zagat acquisition also marks Google’s first foray into original content creation. Google had been accused of poaching user reviews from the likes of Yelp for use on Google Places pages, without providing a link back.

Only about half of Twitter’s 200 million-plus registered members log on daily but the microblogging website is chalking up growth of 40 percent every quarter in mobile device usage, CEO Dick Costolo said. Twitter is gearing up for a hotly anticipated initial public offering. But Costolo told reporters they would do so only on their own terms. Twitter.com now sees about 400 million unique visitors every month, a 60 percent leap from 200 million at the start of the year.