Apple is one of the biggest purchasers of tax credits from companies in a Pennsylvania scheme to help new businesses.
While it could be argued that by purchasing these tax credits, Apple is helping start ups in the area, the Philadelphia Inquirer claims that Apple is trying to reduce its tax liability in Pennsylvania by buying up the tax credits.
According to the Pennsylvania Department of Community and Economic Development's (DCED) 2012 report on the Keystone Innovation Zone (KIZ) tax credit program, Apple was the biggest buyer of tax credits, having acquired 32 approved tax credits worth $2.33 million that year.
The KIZ program provides tax credits to for-profit companies that are less than eight years old operating within specific targeted industries within the boundaries of a Keystone Innovation Zone (KIZ) Program. There is a total pool of up to $25 million in tax credits available to KIZ companies annually, and the KIZ tax credit program significantly contributes to the ability of young KIZ companies to transition through the stages of growth, according to the explanation of the scheme on the Pennsylvania Department of Community & Economic Development.
"This innovative tax credit helps build strong relationships between businesses and universities to create good-paying jobs for graduates right here at home," DCED Secretary C. Alan Walker told the Economic Development Blog.
EcoTech co-founder Marine Patrick Clasen told the site: "Our first tax credits helped us overcome a negative cash-flow situation early on giving us enough breathing room to grow and meet customer demand."
According to the Philadelphia Inquirer, small companies got between 88 cents and 92.8 cents on the dollar when they sold their credits through a broker recently.