Apple says pays $38 bn in taxes on repatriated earnings

Doris Richards
January 21, 2018

The sum is expected to be the biggest payment under the reforms, which slash the United States corporate tax rate.

Apple said its plans would contribute more than $350bn to the U.S. economy over the next five years.

However the firm said: "We have never - and would never - do anything to intentionally shorten the life of any Apple product, or degrade the user experience to drive customer upgrades".

Over the next five years, Apple said it would focus its capital spending on three areas: direct employment, suppliers and manufacturers, and the "fast-growing app economy". Apple yesterday said it had just broken ground on a new facility in Reno and also recently announced a new data center project in Iowa.

Apple is already facing lawsuits in the United States and elsewhere over accusations of having defrauded iPhone users by slowing down devices without warning to compensate for poor battery performance and to push clients into buying new phones.

Apple is set to part with a portion of its quarter-trillion dollar cash pile, with CEO Tim Cook revealing this week that he has "narrowed the list" for a location for a new company headquarters.

Apple had earlier said it planned $16bn in capital expenditures in 2018, up from about $15bn in the prior year.

The iPhone maker said in a statement it plans to use some of its foreign cash stockpile, which qualifies for reduced tax rates under a recent bill, to invest in new projects. They also stopped applying the corporate rate to profits that companies make overseas, in exchange for a one-off tax payment.

Before his election, President Donald Trump singled out Apple for criticism on more than one occasion, taking the company to task for - among other things - manufacturing its iPhones in overseas factories and fighting the U.S. Department of Justice in court over the security of an iPhone seized after a mass shooting in California.

House Speaker Paul Ryan, a Republican congressman who spearheaded the tax overhaul, celebrated Apple's plans to invest in a post on Twitter. "Huge win for American workers and the U.S.!"

Opponents to the new tax law predicted much of the money firms saved from the cuts would go to share buybacks and higher dividends.

The company has spent $166bn already to repurchase shares under a plan to return $300bn to shareholders by March 2019.

After the USA technology colossus stated publicly in 2013 that it was paying its proper share of taxes, it moved the bulk of its untaxed overseas cash to Jersey, a British dependency in the Channel Islands, various media organizations reported, based on the once-secret cache of documents.

Other reports by Iphone Fresh

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