Apple May Be Able To Retrieve Overseas Cash Under Trump Tax Plan

Apple and many other technology companies could gain from President-elect Donald Trump‘s support of a one-time repatriation of U.S. companies’ corporate profits held overseas, but only if the idea get enacted by a still-Republican-held Congress, according to a report from the Financial Times.

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Trump has proposed a 10% repatriation tax on profits of US corporate foreign subsidiaries, down from the statutory 35%. The top five overseas cash holders are Apple, Microsoft, Google-parent Alphabet, Cisco and Oracle.

Trump’s cash repatriation proposal “could bring a flood of money back into the U.S. that would be available for dividends, share buybacks and possibly for capital investments,” said Kevin Logan, an HSBC economist, in a research report. “The tax revenue raised could be used to fund an infrastructure spending program, something that was advocated by both candidates during the presidential campaign.”

Apple is on track to have $230 billion in overseas cash by the end of 2016, followed by Microsoft at $113 billion, Cisco at $62 billion, Oracle at $52 billion and Google at $49 billion, according to Moody’s Investor Service. The top five companies will have $505 billion overseas by year-end, or 86% of their total cash, up from $441 billion in 2015.

“We expect most companies would take advantage of a hypothetical tax reduction on permanently repatriated monies to the maximum extent possible, but the devil is always in the details,” Moody’s analyst Richard Lane stated. ” Nevertheless, a hypothetical 10% tax on the $1.3 trillion offshore that we project for 2016 translates into $130 billion in tax revenue that could be invested in efficiency enhancing, domestic infrastructure investments.”

Trump has also proposed reducing the U.S. corporate tax rate to 15%, down from 35%, in an effort to keep companies from leaving for countries with lower rates.

World-traveling, tech-savvy, music-producing writer obsessed with all things Apple, video games, and the finer things in life, e.g. mezcal and tacos. When I'm not writing for IIC I'm exploring new places, eating new foods, and generally trying to be a decent human.

  • Chris

    No matter what ones personal opinion of Trump is, is that a proper picture for a president-elect? I would expect iPhoneinCanada to show more respect to a now going to be world leader.
    I highly doubt that they would be posting an unflattering picture like that had Clinton won…

  • Kim

    I agree 100%. Media needs to be impartial no matter the individual opinion.

  • m Arch Tom’s on Bar N Ass

    QUOTE: Trump has also proposed reducing the U.S. corporate tax rate to 15%, down from 35%, in an effort to keep companies from leaving for countries with lower rates.

    Comment: and in an effort to avoid sanctions and fines for companies amid tax-evasion ( or non-legit state-aids from EU member states ).
    marc

  • FragilityG4

    If you do that onto a democarte it’s hate. If you do it onto a republican it’s good sport. Such a contradiction.

  • Harold Mitchell

    Absolutely true….

  • Mark Holoubek

    Has anyone dug deeper on this? Are these tax breaks reliant on moving all the manufacturing back as well?

  • Hondanazi

    Maybe he shouldn’t make faces like that when s

  • Hondanazi

    Maybe he shouldn’t make faces like that when he is screaming his bigoted, racist, sexist, misogynist, xenophobic psycho-babble tripe so we won’t have those kind of pictures……..just sayin’

  • El Cockblock

    *starts slow clap…

  • m Arch Tom’s on Bar N Ass

    @markholoubek:disqus manufacturing will never get back and this is valid for both EU and USA, in spite of the big effort any politician can make to pressure on that, risks for running manufacturing plants/factories and putting laborers at risk, also risks for end-consumers may be harmed by goods imperfections, made it inevitable and mandatory to subscribe to insurance policy, then raised the cost of labor so high, in “civilized” world, ( i.e: risk assessment and management ).
    All companies then will progressively move and relocate manufacturing operations away to china, to eliminate risks for laborers in US and EU, and to lower risks for end-consumers, also companies avoiding being charged higher compensations or premium insurance policy fees, should anything go wrong for either laborers or end-consumers. ( i.e: responsibilities moved to china and with PRC government )