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Former US Senator John E. Sununu defends Apple's tax practices
Former New Hampshire Senator John E. Sununu on Monday penned an op-ed piece for the Boston Globe defending Apple's tax practices. Just last week, of course, a trio of Apple executives made their way down to Washington D.C. to answer questions before a congressional subcommittee regarding Apple's foreign cash hoard of $100 billion. In the op-ed piece, Sununu accurately points out that none of what Apple is doing is illegal. On the contrary, Sununu notes that Apple is simply doing what any other similarly situated multinational corporation would do, which is to minimize its tax liability within the confines of the law. As it stands now, the US currently has the highest corporate income tax rate in the world. Consequently, Sununu writes that the real blame with respect to corporations keeping untold billions in profits overseas falls directly on Congress. By refusing to feel guilty about the results produced by a 30-year-old corporate structure, Cook placed the responsibility for the taxes Apple pays where it belongs: on the US Congress. And Congress, being Congress, took the bait. Amid hearings of the House tax-writing committee he leads, Representative David Camp bluntly declared, "The tax code is a mess." John McCain observed that the Apple situation "reflects a flawed corporate tax system." [Carl] Levin closed his own hearing by saying, "It's unfair. It needs to change." Of course, calling for change is much easier than implementing it. Sununu points out that reworking the tax code isn't necessarily straightforward because Congress needs to strike a balance between raising revenues and simultaneously enticing corporations to repatriate billions in overseas profits.
NYT Columnist Joe Nocera laughably calls Tim Cook a liar
As we reported previously, Tim Cook and two other Apple executives appeared before Congress earlier this week to discuss Apple's tax practices. The focus of the hearing centered on how Apple manages to keep the bulk of its foreign earned cash overseas and what might be done to incentivize Apple to bring that cash back to the US. In an op-ed piece in the New York Times today, columnist Joe Nocera misconstrues the events which took place at the hearing and proceeds to characterize Tim Cook as a liar who, according to Nocera, learned how to create a "reality distortion field" from Steve Jobs. I'm not sure if Nocera watched the entire hearing, but I did, and many of his characterizations of the events which took place are skewed at best, if not downright false. Let's dive in. Nocera writes: On Tuesday, despite the overwhelming evidence presented by the Senate Permanent Subcommittee on Investigations that Apple engaged in dubious tax avoidance gimmicks, Cook claimed that Apple never resorted to tax gimmickry. First off, given that the tax experts brought in by Congress testified that Apple's tax strategy doesn't run afoul of International Law, I fail to see how the evidence presented by the Senate Subcommittee overwhelmingly proves that Apple engaged in dubious tax avoidance gimmicks. Call it semantics if you will, but Apple's tax mechanisms are set up in such a way as to minimize the company's overall tax liability, all within the confines of the law. As easily as one can call it tax gimmickry, another could just as quickly and accurately call it tax compliance. Nocera continues: Cook said, "We pay all the taxes we owe -- every single dollar." He added that Apple had never shifted any of its American profits to an offshore tax haven when, in fact, that is basically what it has done, routing tens of billions in pretax profits to a shell corporation in Ireland that exists solely to avoid taxes in the United States. He even said that the low taxes Apple pays overseas is on the profits of its overseas sales. Not to put too fine a point on it, but this was a flat-out lie. On this point, Nocera has his facts completely backwards. In its prepared testimony to Congress, Apple also emphasized that it has never shifted any of its American profits to offshore tax havens. This is true, despite Nocera's curious assertion to the contrary. What Cook is saying here is pretty simple. Every single dollar Apple earns in the United States is taxed. Further, Apple, in no way whatsoever, moves any of its profits earned in the States abroad as to avoid paying US taxes. Regardless of what you think about Apple's tax setup with respect to its foreign earned income, Apple has not routed any of its American profits overseas. While some companies may engage in such behavior, not one iota of evidence presented even hints that Apple does any such thing. That said, Cook's assertion that the low taxes Apple pays overseas is on the profits from its overseas sales is accurate. Nocera calls this a flat-out lie, but conveniently neglects to explain why or how. Instead, he proceeds to talk about how folks in the Senate hearing were eating out of Cook's hand. In other words, Cook spent Tuesday claiming that the sun was setting when it was actually rising, and, predictably, by the time the hearing had ended, most of the senators were agreeing with him. Senator John McCain, the committee's ranking Republican, who had earlier labeled Apple "a tax avoider," was soon swooning over Apple's "incredible legacy." Again, I watched the entire hearing and to say that most of the senators were agreeing with Cook simply isn't true. The notion that McCain came out guns ablazin' against Apple, only to be left swooning over Apple's legacy is misguided. The fact of the matter is that Senators McCain and Carl Levin pulled no punches with Apple. They went after Apple hard, asked extremely tough questions and often times, really put Apple's panel of executives on the hot seat. Comments regarding Apple's aptitude for innovation and its legacy were certainly made, but these were often made in the context of, "Hey listen Apple, we think you're a great company and all, but your tax practices seem shady." In other words, praise for Apple was typically sprinkled in at the end of particularly tough question and answer periods. I encourage you to go back and watch video of Levin grilling Apple executives for an extended period of time. It almost gets uncomfortably and awkwardly intense. Levin was completely unswayed by any of Apple's testimony, it seemed. Nonetheless, Levin, at the end, noted that Apple makes great products, going so far as to say that his granddaughter has an iPhone. Moving along, Nocera continues: Indeed, Apple's fabulous success over the past decade or so - its creation of the iPads and iPhones that the world lusts over - is a large part of the reason it always gets the benefit of the doubt, whether deserved or not. Two years ago, when David Kocieniewski of The Times reported on General Electric's tax-avoidance prowess, a storm of protest resulted. Last year, however, when Kocieniewski and Charles Duhigg wrote about Apple's tax avoidance schemes as part of a series about the company that won a Pulitzer Prize, it was greeted mainly with yawns. Nobody really wants to hear anything bad about Apple. At this point, I have to wonder if Nocera is simply trying to troll us. If anything, Apple's success with the iPod, iPhone and iPad is precisely why the company rarely gets the benefit of the doubt. Indeed, Apple's unprecedented success, coupled with its billions in the bank, seems to have created an environment where Apple is often held to an entirely different standard than other companies. Furthermore, the notion that the New York Times' series of articles was greeted with yawns is laughable. It did win a Pulitzer Prize, right? On that note, Philip Elmer-DeWitt of Fortune wrote the following this past April: The fact is, the New York Times knows how to win Pulitzers -- better than any other journalistic operation. It has now won a record 112. It employs editors who specialize in identifying Pulitzer-winning topics and assigning reporters who will bring them home. And that's what it set out to do -- with Apple as its conspicuous subject -- in seven major stories capped with a self-serving kicker that suggested that it was Times' reporting that led to substantive changes in the working conditions in China's electronics factories. As for the claim that no one wants to hear anything bad about Apple? That's even more laughable. If anything, it stands to reason that the NYT specifically targeted Apple because it knows that people love to read articles which badmouth Apple. It's a sure-fire way to generate an abundance of pageviews and attention, no matter how factual the assertions may be. Heck, some columnists have even made careers out of exploiting this dynamic (I'm looking at you Rob Enderle). Almost comically, Nocera later in his piece admits that Congress has in fact singled out Apple, just mere paragraphs after claiming that Apple is somehow always afforded the benefit of the doubt. In short, people love to hear anything bad about Apple. Who doesn't enjoy, after all, watching a giant fall? Nocera goes on to explain Apple's tax setup abroad. Subsidiaries, holding companies, Ireland -- it's all there. But here's the thing -- this isn't an Apple issue. A vast number of multinational corporations implement the same tax minimization schemes as Apple. Many companies, from Google to Pfizer to Coca-Cola all hold billions of dollars in offshore cash that they are under no legal obligation to repatriate back to the US. And with the United States' extremely high 35 percent corporate income tax rate, can you blame them? So sure, Apple has about $100 billion in profits overseas, but when you tally up the money all US-based corporations hold overseas, we start talking about trillions of dollars. Again, this isn't an Apple issue; it's a tax code issue. Howard Gleckman highlighted this very fact on the Tax Policy Center Blog: The remarkable thing about the Senate Permanent Investigations Subcommittee's report on Apple Inc.'s corporate tax avoidance is how unremarkable it is. Because Apple is so profitable, the dollars involved will certainly attract attention (this is a Senate committee after all, so that is the point). The report alleges Apple reduced its U.S. corporate income tax by an average of $10 billion-a-year for the past four years. Since the corporate levy generated only about $240 billion in 2012, $10 billion foregone from one company is a very big number indeed. But while it added a few interesting twists, Apple cut its taxes with the same tools multinationals have been using for years to minimize their worldwide tax liability. And if there is a scandal, I suppose it is the very ordinariness of these transactions. Apple's tax avoidance shop, it seems, is a lot less innovative than its phone designers. It's also worth pointing out comments made by Senator Rob Portman during this week's hearing: If we don't reform the tax code, we're competing with one hand tied behind our back. Almost all of our industrial competitors have shifted to a territorial system including the UK, France, Germany, Japan. I think that's the right way to go. They don't tax active business income earned beyond their borders and their businesses are more competitive as a result. $1.5-$2 trillion is locked up overseas. That money is being deployed to put factories and R&D overseas. We've got to move quickly. No other nation erects such a high barrier to bringing earnings back to the US. Every one of our global competitors have reformed their tax systems since we last reformed ours. Not just the rate, but the code. If we don't reform, we'll continue to lose opportunities. Nocera, with his seeming focus on Cook's reality distortion field doesn't seem to grasp that the real issue is much larger than Apple.
Jon Stewart covers Tim Cook and Apple's tax issue
On The Daily Show last night, Jon Stewart covered, in typically hilarious fashion, Apple's recent trip to Washington D.C. to defend its tax practices. The Daily Show with Jon Stewart Get More: Daily Show Full Episodes,Indecision Political Humor,The Daily Show on Facebook Funny stuff, per usual. My favorite moment was Stewart's sarcastic take on various senators heaping praise upon Apple. How about we pay you?! How about that? For the inconvenience of you having to keep your money overseas. I mean, the upkeep must be unbelievable, like having a pony. The Tax Code nano bit is also great.
Some comic relief from Apple's congressional appearance
Apple sent three top executives to Washington, D.C. yesterday to testify in front a congressional hearing on Apple's tax practices. Making the journey from Cupertino were CEO Tim Cook, CFO Peter Oppenheimer and Phillip Bullock -- Apple's head of Tax Operations. The hearing went on for a few hours, and as one might expect from such a controversial issue, the lively debate became intense at times. Senator Carl Levin, D-Mich., took an especially tough stance on Apple, calling its tax practices "unacceptable." Nevertheless, there were moments of levity we can extract from the hearing. For starters, Senator John McCain, R-Ariz., following his pointed questions for Apple's panel about taxation, thought it high time to ask Cook about updating apps on his iPhone. "What I really wanted to ask," said McCain, "is why the hell do I have to keep updating apps on my iPhone all the time?" I can't really blame him though. I mean, McCain had to either ask Cook while he had the chance or otherwise fork over $610,000 for the opportunity to have coffee with the Apple CEO. All in all, it was some very shrewd financial planning from McCain. All kidding aside, here's McCain and Cook sharing a lighthearted moment. Second, let's have a bit of fun with Apple's tax math. In an effort to demonstrate the sheer volume in taxes Apple already pays domestically, Cook noted during his opening remarks that, in 2012, Apple paid the US Treasury "nearly $6 billion, or $16 million per day." Curious, I decided to see how much $16 million per day translates into on an hourly basis. Dividing by 24 yielded an interesting figure -- $666,666.667 per hour to be exact. Yep, the devil's number. Something tells me Levin isn't surprised. Also of note is that $666.66 was how much the Apple I originally retailed for. Saving the best for last, we have the always hilarious folks from The Onion who solicited the following "opinions" from average Joes as part of their sarcastically brilliant "American Voices" feature.
Livestream of Tim Cook and Peter Oppenheimer at today's congressional hearing
Catch up on all of Apple's tax controversy here as both CEO Tim Cook and CFO Peter Oppenheimer gear up to testify in front of Congress to address Apple's billions in foreign-stored cash.
VP Joe Biden: 'No legal reason' the US can't tax violent media
Vice President Joe Biden has been on the front lines of the gun violence debate since the mass shooting in Newtown, Connecticut, in December. In January, Biden led a task force assigned by President Barack Obama to examine possible means of curtailing gun violence in the US, and his findings prompted Obama to call for scientific research into the effects of violent media on young minds. Earlier in May, Biden met behind closed doors with 20 representatives from faith-based organizations to discuss gun control and immigration, and he briefly addressed video games, Politico reports. Franklin Graham, son of evangelist Billy Graham, proposed to Biden that "media and entertainment that portray violence should be subject to a special tax, with the proceeds going to help victims and their families," according to Rabbi Julie Schonfeld. Biden replied that there was "no restriction on the ability to do that; there's no legal reason why they couldn't" place a tax on violent media, Sister Marjorie Clark told Politico. Biden again emphasized the need for more research into the subject, Clark added: "He said they really need a good scientific study, which they've done on things like smoking." During his initial fact-finding meetings in January, Biden expressed particular interest in speaking with inter-faith organizations, though he met with a wide swathe of communities, including entertainment companies, advocacy groups, youth organizations, the mental health community and the NRA.
France mulls 'culture tax' on devices like the iPhone
Reuters reports that France, in an effort to generate money to help fund cultural initiatives, is considering implementing a special tax on smartphones and tablets. The proposal falls under France's "cultural exception" policy, enacted to ensure that the arts in France can continue to thrive in the face of competition and other market forces. As it stands now, TV and radio broadcasters, along with internet service providers, are already subject to a tax to promote the arts in France. A report commissioned by the French government, however, points out that a tax on hardware manufacturers like Apple and Amazon would be even more helpful given that folks are now spending more on hardware than they are on content. "Companies that make these tablets must, in a minor way, be made to contribute part of the revenue from their sales to help creators," Culture Minister Aurelie Filipetti told journalists. French President Francois Hollande will reportedly decide by the end of July whether or not the proposed tax will go into effect. If Hollande gives it the green light, the plan, which Filipetti describes as "minimal," will be submitted as part of the budget in November. Lastly, the Associated Press notes that the proposed tax plan would yield the French government about 86 million euros per year, or approximately US$111 million.
US Senate passes internet sales tax bill, faces a stiff fight in House
The debate over taxing out-of-state online sales in the US has been raging for years, but there are signs that the often messy saga is finally winding to a close... well, maybe. The Senate just voted 69-27 in favor of the Marketplace Fairness Act, a bill that would make internet retailers collect out-of-state sales taxes that Americans are already obligated to pay, but rarely do under a current system that puts the onus on (frequently unaware) buyers. Don't be too hasty in cheering or jeering the apparent conclusion, however. The bill's next stop is the House of Representatives, and the reception may be decidedly colder this time around. The act could be submitted to the President this year if it does survive the gauntlet, although a six-month buffer would likely push any tax changes to 2014 if the bill is ever signed into law. [Image credit: Scrumshus, Wikipedia]
UK Interactive Entertainment CEO defends games as culture before EU tax investigation
Last week the European Commission announced it would kick off an "in-depth investigation" into proposed UK tax relief for video game developers, and UK Interactive Entertainment's Jo Twist wasn't too pleased by the news. This week the non-profit's CEO calls on the UK games industry to send a clear message to the European Commission, that games are culturally and economically relevant."[Games] generate culture, and are purveyors of culture in their own right," Twist writes. "They generate emotion and opinions, and the way they do that is through story, through experiences, and a huge diversity of innovative mechanics ... We have to show why there are not as many culturally British games being made as there could be and how the credit would help address this."The UK games tax relief plan calls on developers to pass a "cultural test" before receiving financial aid, incentivizing games starring British lead characters, in British locations or made by a local British team. The EU Commission worries the tax relief could negatively impact competition."The market for developing video games is dynamic and commercially promising," said EU Commission VP of Competition Policy Joaquin Almunia. "It is not clear whether the taxpayer should be subsidizing this activity. Such subsidies could even distort competition."Twist notes that the EU Commission investigated both the UK film tax credit and French video game tax system, both of which were eventually approved, setting a historical precedent to accept the UK's proposal. Further information on UKIE's defense can be found on its Facebook page.
UK games industry showing slight signs of recovery
UK trade association TIGA published a report this week, claiming that employment in UK games development grew by four percent in 2012.Looking deeper at the numbers shows us UK studios aren't making the huge games they used to, however, and are evolving into smaller studios supporting more mobile and tablet development.According to TIGA, from 2011 to 2012, creative staff across the UK grew from 8,888 to 9,224, which is where the modest four percent increase cited earlier comes from. The number of studios in the UK increased from 329 to 448 – that's 119 new studios and only 336 new jobs. The UK has shifted to smaller studios after years of layoffs and closures."Mobile and internet based gaming provide opportunities for growth; we have access to a highly skilled and creative workforce; and TIGA's Games Tax Relief will give a further boost to employment and investment from April 2013," said TIGA Chairman and Rebellion CEO Jason Kingsley.TIGA estimates the sector's contribution to UK gross domestic product increased from £912 million to £947 million in 2012. The UK finally passed tax relief for the ailing sector last year, having proven it passed the cultural test. [Image: Christos G. via Shutterstock]
UK video game tax relief hinges on passing this 'cultural test'
The UK government outlined a "cultural test" that video games developed in the region must meet for the studio to qualify for tax relief, as part of the industry overhaul begun earlier this year. A game must earn 16 points to receive the tax break, with points awarded for such criteria as being "set in the United Kingdom or another EEA state," which includes all countries of the European Union, plus Iceland, Liechtenstein and Norway. The studio gets four points if the game stars two of three lead characters "from the United Kingdom or another EEA state or from an undetermined location," or it depicts "a British story."If at least half of the game's development is completed in the UK, studios can earn three points, while a "qualifying" project leader, script writer, composer, artist, programmer, designer and department head earn one point each. If at least half of the entire team qualifies as a legitimate UK operation, the studio gets another point. The tax code is like a game in itself.For example, if a studio in the UK (3 points) with all local staff (8 points) creates a game about a time-traveling doctor in a bowtie (4 points) as he journeys around Liverpool (4 points), Hufflepuff wins the House Cup. See? Easy.Peruse the entire cultural test below.
UKIE wants 30% games industry tax break, UK begins tax plan scrutiny
UKIE, a trade group for the entertainment industry in the UK, joined UK gaming trade association TIGA in calling for a tax relief flat rate of 30 percent across the industry, in the hopes of stimulating the UK's game development business. In March, UK chancellor George Osborne pledged to "turn Britain into Europe's technology centre, starting with digital content," by extending the country's film tax breaks to the TV, animation and gaming industries.Yesterday was the deadline for suggestions to the UK government on how the gaming tax breaks should be handled. TIGA previously suggested the 30 percent flat rate, or an alternative tiered rebate giving 25 percent relief to projects costing £250,000 ($400,000) or more.After consulting with more than 200 UK companies, UKIE proposed relief should extend to the entire industry, covering indies, large studios and new companies established by parties overseas -- all with a 30 percent relief rate, regardless of budget. UKIE included relief for DLC and post-launch support in its proposal.The tax relief is poised to begin in April, pending parliamentary approval and a round of summaries, scrutiny by tax professionals and consultation. Edge has a round-up of the whole process here.
TIGA outlines UK's Games Tax Relief, calls for 30% flat rate
TIGA, the UK games industry's trade association, outlined its recommendations for Games Tax Relief to the British government today. Following the government's backing earlier this year for tax relief support (as provided in Canada, France, and the US) TIGA called for a 30% flat rate to save the nation's struggling games industry.TIGA also suggested an alternative of tiered rebate, with 30% for projects costing less than £250,000 (just under $400,000), and 25% for those costing more. TIGA's proposal includes recommendations of post-release costs being covered, eligibility for educational games, and support for free-to-play games and those based on in-game advertising.TIGA believes the proposed model can bring more than 4,500 jobs to the UK games industry over the next five years, and increase its returns by nearly $0.5 billion.The news follows the recent demise of Sony Liverpool, one of the UK's longest serving game studios. The government will now consider TIGA's proposal, with the aim of introducing GTR from April 2013, subject to European Commission approval.
Amazon to start collecting sales tax in New Jersey beginning July of next year
Taxes. Taxes. Taxes. That's what you folks living within the Garden State will have to pay on Amazon purchases starting July 2013. The recent news -- which is likely to cause some of you to throw a minor temper tantrum -- comes shortly after Jeff Bezos & Co. settled with the Texas government to also begin collecting sales tax in that state. Similar to the Lone Star deal, though, Amazon's agreed to create about 1,500 full-time jobs by building a couple of distribution centers in New Jersey -- and let's face it, job creation is always good news. Sorry, but looks like the Jersey Shore crew will have to spend a couple extra bucks the next time they place an order for that weekly stock of tanning lotion.
Facebook allowed to triple size of its HQ, pays $10 million for the privilege
Swollen with cash following its IPO, Facebook is looking to expand its headquarters in Menlo Park. Its plan to triple its workforce there from 2,200 to 6,600 people was approved by local officials last night, removing the previous cap that allowed a maximum of 3,600 messy, resource-consuming humans. In lieu of the added burden on the city, Facebook will have to contribute $850,000 per year for ten years, plus a one-time payment of $1,000,000. The start of a surge towards greater products and profits, or the beginning of a complacent corporate decline? We'll let the stock market decide.
Amazon to collect sales tax, create 2,500 jobs in Texas
If Amazon's been your internet safe haven from the ravages of sales tax, you may want to sit down. As part of a settlement with the great state of Texas, Bezos' baby will start collecting the state's requisite 6.25-percent sales tax on July 1st. The settlement resolves the online retailer's ongoing dispute with the Lone Star state, which claimed that Amazon owed $269 million in back taxes. In addition to taking up collection, Amazon has agreed to create at least 2,500 jobs and invest a minimum of $200 million in capital investments, though it admits no fault, and believes "the assessment was without merit," according to its latest SEC filing. Grouped in with Kansas, Kentucky, New York, North Dakota and Washington, this agreement makes Texas the sixth state to collect sales tax from Amazon -- and California, Nevada and Arizona will join the collection club in due time. Check out the source links below for the Texas Comptroller's official statement and more reading on Amazon's tax agreements across the nation.
Apple makes a tax deal for Prineville, Oregon data center land
We've heard before that Apple plans to build a data center on land it previously purchased in Oregon, but now the Associated Press reports on part of the cost. The company has reportedly agreed to pay US$150,000 per year to local governments, and has signed off on at least 35 jobs. Those jobs will be paid at a rate that's at least 150% of the average wage in the Oregon county. Finally, according to the AP, Apple will have to invest at least $250 million into the data center building itself. In return for all of that, Apple will be exempt on property tax payments for the next 15 years. Whether that will be worth it or not depends on exactly how much they build there, but odds are Apple's accountants aren't that worried. The company already paid $5.6 million for the land earlier this year, and it's setting up plans to both build up the infrastructure of the local power company to keep the data center running, as well as a green energy site there on the spot. Oregon is apparently a popular place for data centers like this. Google, Amazon, and Facebook all have similar sites in the surrounding area. [via MacRumors]
Engadget Giveaway: win one of three Kindle Fires, courtesy of TurboTax!
Ah, nothing takes away from the beauty of a new spring quite like the demands of Uncle Sam. TurboTax is hoping to relieve you of much of that stress, finally bringing its easy-use software in the form of an Android tablet app -- and even Kindle Fire users get to share the apptastic love, which is why the tax software company hooked us up with three of them to give away to our fine readers. You may be procrastinating until April 17th to file your taxes, but this contest only lasts for two days, so head below to leave a comment. Good luck!
UK finally implementing game tax relief
The UK government announced today it would finally provide tax relief for game developers, which comes as welcome news to the region's struggling scene. The relief will take the form of £15 million in 2013-14, with £35 million in 2014-15."Our research shows that Games Tax Relief should generate and safeguard: 4,661 direct and indirect jobs; £188 million in investment expenditure by studios; increase the games development sector's contribution to UK gross domestic product by £283 million; generate £172 million in new and protected tax receipts to Her Majesty's Treasury, and could cost just £96 million over five years," TIGA CEO Dr. Richard Wilson stated today.With some luck, the relief will help slow the "brain drain" occurring in the UK games industry following numerous studio closures.Wilson also said, "Tax breaks for games production will ensure that the UK remains at the forefront of video game development."That's a nice dream, but current tax break champion Canada and many others are ahead of the UK by a mile ... er, kilometer. [Pixelbliss via Shutterstock]
Russia reclassifies iPad as a computer, avoids 5% import tax
According to a report in the Russian newspaper Vedomosti, the Russian government has classified the iPad as computer. While this will bring a smile to analysts who love to compare iPad and PC sales, this move has nothing to do with the market category of the device. This change is an administrative one and lets Russian customers import the iPad without paying a 5 percent import tax. Previously, the iPad was taxed because the 3G version with GPS was classified as a navigation device. The report did not clarify whether the 3G iPad will still be considered a navigation device, but it did say other tablets with GPS will be subject to the tax.
