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Examining Apple’s complicated relationship with NZ

James Henderson | March 23, 2017
Apple is caught up in a controversy over paying zero tax in New Zealand over ten years

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What a week it’s been for Apple in New Zealand.

On the one hand, the country is aghast following revelations that the tech giant paid zero tax in New Zealand for the past 10 years, despite reporting sales of $4.2 billion during the decade.

Uncovered by the New Zealand Herald, the company dodged the tax office on a spectacular scale, “using every trick in the book” to avoid making payment.

Yet as one half of the nation condemns Cupertino, the other rejoices at news that the vendor has opened an office in Wellington, as a base to develop augmented technology reality.

According to Bloomberg, Apple has lured several employees from Weta Digital, tapping the local expertise of the Wellington-based special effects business.

Unsurprisingly, the move has left “local technologists buzzing”, creating an interesting dynamic across the industry as a result.

Because as the industry attempts to make a rightful stand against tax avoidance by multi-national corporations, of which Apple is a chief culprit, it simultaneously displays the qualities of a crazed worshipper, rendering such a serious stance almost redundant.

In light of the company’s inability to pay what is required at a local level, American-based Apple users have weighed in behind Kiwi politicians.

First observed by the New Zealand Herald, 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.

Of course, hard working Kiwi taxpayers have every reason to feel outraged by revelations that a massive company such Apple, with billions of dollars of New Zealand revenue, has paid no New Zealand tax over ten years, says Labour’s Revenue spokesperson Michael Wood.

“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,” Labour Party Revenue spokesperson, Michael Wood, said.

“We know that this is the tip of the iceberg for big multi-nationals being let off the hook by the National Government being completely asleep at the wheel.

“Cabinet was officially warned about the huge scale of multi-national tax avoidance five years ago, yet as late as last year the Revenue Minister was saying there was no problem and he’d seen no evidence to suggest New Zealand was missing out. It’s obvious that we are.”

According to Wood, the government has been forced into “belated action” by the media and the opposition, and even then are refusing to consult on the option of a diverted profit tax, which has been employed to deal with this issue in Australia and the UK.

 

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