Apple CEO and CFO testify in front of Senate Committee on Tax Policy: Excerpts

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At the beginning of the hearing, Senators are allowed to make whatever opening statements they wish. Senator Rand Paul (R-KY) gave a spirited defense of Apple, saying he was "offended" by the hearing.

"Tell me a politician who is up here and doesn't try to minimize his taxes… Tell me what Apple has done is illegal. I am offended by a government… that convenes a hearing to bully one of America's greatest success stories… If anyone should be on trial here, it should be Congress. I frankly think the committee should apologize to Apple."

Instead of Apple executives, we should have brought in a giant mirror. This problem is solely and completely caused by our tax code. This committee should look in the mirror. "I find it abominable."

We need to apologize to Apple, compliment them for the job creation they're doing, and get on with our job and redo the tax code.

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McCaskill: What would it cost to move out of California or move entirely to Ireland or China? What keeps you from moving on a cost analysis basis?

Cook: We're an American company. We're proud to be an American company. The vast amount of our R&D is in California. We love it there.

McCaskill: It's an intangible?

Cook: It's who we are as people. We're an American company whether we're selling in China or Egypt. We're an American company. It has never entered my mind that we would move to another country. It's beyond my imagination and I have a wild imagination. It's beyond it.

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Levin: And all the profits from Mexico and Canada and Argentina are taxed in the United States. But you made a decision to shift economic value overseas and the result is that most of your profits are not taxed. You're an American company. You're proud of it, we're proud of it. The result of these arrangements is that most of your profit is now in Ireland in these companies that don't exist. Of course we have to change this system. But to change it, we have to understand what is going on. What is going on is a huge loss of revenue to the United States. We've got these corporations that are able to shift profits to places where you don't pay income tax on it. We better understand that if we're going to correct it. That's our purpose here today. To shed a light on that. I hope that purpose has been achieved. We cannot continue a system where the company, a multinational company, is phenomenally as successful as yours and can make a decision, sitting down in 2008 as to where the profits will flow.

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