Does Laurence Kotlikoff Understand Apple’s Business Model?

He wants to Abolish the Corporate Income Tax presumably because it would increase the real income for workers. Tax Justice Network has a must read challenging the supply-side nature of Kotlikoff’s argument. I just want to comment on this claim:

Apple’s tax return says it all: The company, according to one calculation, paid only 8.2 percent of its worldwide profits in United States corporate income taxes, thanks to piling up most of its profits and locating far too many of its operations overseas.

Tax Justice Network gives credit to Citizens for Tax Justice for this reality:

But Apple is a perfect example of a corporation that does not actually move many jobs offshore but rather is engaging in accounting gimmicks to make its U.S. profits appear to be generated in offshore tax havens.

Maybe Dr. Kotlikoff should read the latest 10-K filing for Apple. There he would learn a few things such as the fact that Apple outsources it production preferring to be in the design and distribution business. The vast majority of its R&D personal are U.S. employees. We also see this quote from their 10-K

As of September 28, 2013, the Company had approximately 80,300 full-time equivalent employees and an additional 4,100 full-time equivalent temporary employees and contractors. Approximately 42,800 of the total full-time equivalent employees worked in the Company’s Retail segment.

Since about 40% of Apple’s sales are to U.S. customers, it is reasonable to believe that over 16,000 of these Retail segment employees are also U.S. workers.