Apple to send $38 billion in taxes on overseas cash to the US
Apple said Thursday it would pay roughly $38 billion in tax to the United States because of recent tax law changes, after repatriating cash it now holds overseas.
The move comes as American and European politicians remain divided over how U.S. tech companies — firms that have, collectively, $2 trillion stashed outside of the U.S. — should pay tax on their global operations.
That fight will likely grow as more companies follow Apple’s lead to move money held overseas back to the United States where recent tax reforms permit companies to pay a tax rate of 15.5 percent on repatriated earnings compared to the existing corporate tax rate of 35 percent, before deductions.
“We have a deep sense of responsibility to give back to our country and the people who help make our success possible,” Tim Cook, Apple’s chief executive, said in a blog post.
As part of the announcement, the iPhone maker said that it would spend an estimated $55 billion in the U.S. during 2018 on its own investments and for those targeted within its domestic supply chain.
Apple’s decision to move such a sizable amount of money back to the U.S. will raise eyebrows in many European capitals, as well as within the European Commission, which demanded in 2016 that the company repay €13 billion in back taxes to the Irish government.
Both Ireland and Apple are appealing that ruling.
UPDATED: This item was updated to clarify that Apple said it will pay $38 billion in taxes to the U.S.