MOUNTAIN VIEW — Last month’s appearance by Apple (AAPL) CEO Tim Cook before a skeptical Senate subcommittee may provide a much-needed tail wind to efforts to overhaul the U.S. tax code, U.S. Rep. Zoe Lofgren said Friday at a forum of Silicon Valley leaders.
Members of the Senate’s Permanent Subcommittee on Investigations accused Apple of paying no taxes on the $102 billion in overseas cash the company held at the end of March. A year before, officials from Microsoft and Hewlett-Packard (HPQ) had been summoned by the senators to talk about their overseas operations that enable U.S. companies to avoid paying both U.S. and foreign income taxes on their overseas profits.
“Mr. Cook’s appearance was an important one because people across the country were not happy, honestly, to hear that a company that was that prosperous was paying a relatively small amount of tax,” Lofgren, a San Jose Democrat, told the 350 people gathered Friday at the second annual Silicon Valley Regional Economic Forum at the Computer History Museum. “But people aren’t blaming Apple. They’re saying, ‘What is it about the tax code that allows for this to legally occur?’ So I think there’s a little lift on the argument and I would love to see sensible reform to the tax code happen.”
Panelists at the forum — and attendees who voted via smartphones and tablets on the issues they consider most critical to Silicon Valley — cited the need for an overhaul of the U.S. tax code, along with a long list of issues that included comprehensive immigration reform, improved Bay Area mass transit, more funding for education — especially in science, technology, engineering and math — and a revamping of the California Environmental Quality Act that many speakers said hampers business while doing little to protect the environment.
Too often, Mayor Chuck Reed said, the California Environmental Quality Act — or CEQA — is used by labor unions, environmental activists, their lawyers and others to extract “concessions” from developers.
“It’s a rare project that isn’t delayed by CEQA,” Reed said on one panel. “None of these things has to do with the environment. Let’s put the environment back in CEQA.”
A CEQA challenge to the San Francisco 49ers’ new Santa Clara stadium delayed the project nine months, 49ers CEO Jed York said. Without the legal challenge, the stadium could have been ready a year earlier to host the NFL’s 49th Super Bowl in 2015, “which to me would have been a lot cooler.” Instead, they are hosting the 50th Super Bowl in 2016.
While several panelists called for reforms that would help valley businesses, others such as Emmett Carson, president and CEO of the Silicon Valley Community Foundation, reminded the gathering of the need to bring economic prosperity to low-income residents and increase educational opportunities for minority and economically disadvantaged students.
“Emmett Carson each year has sensitized us that this is truly a tale of two valleys,” said Carl Guardino, president and CEO of the Silicon Valley Leadership Group, which hosted Friday’s summit.
Guardino called Carson’s reminder “an important message that not everyone in this room hears regularly.”
With similar summits being held in 15 other regions across California, Guardino believes that the ongoing conversations will lead to meaningful changes a year from now that will benefit Silicon Valley.
“This time next year you’ll have meaningful CEQA reform,” Guardino predicted, “you’ll have comprehensive immigration reform and we’ll be well on our way working toward comprehensive tax reform.”
Contact Dan Nakaso at 408-271-3648. Follow him at Twitter.com/dannakaso.
