Apple Would Rather Go Into Debt Than Bring Home $100 Billion In Offshore Cash

[TruthOut10]

Pay attention, Simpson and Bowles: There are some things in life worse than going into debt.

For Apple Inc., that worse thing is paying taxes: The company announced plans Tuesday evening to borrow money for the first time ever, despite having nearly $145 billion in cash. The problem is that $102 billion of that cash is parked overseas and would be taxed if Apple tried to use it in its plan to give money back to shareholders.

"We are continuing to generate significant cash offshore, and repatriating this cash would result in significant tax consequences under current U.S. tax law," Apple Chief Financial Officer Peter Oppenheimer said on a conference call discussing Apple's earnings for the quarter that ended in March.

Apple's earnings haven't exactly been setting the world on fire quite enough lately to satisfy finicky shareholders. So the company is under increasing pressure to give its shareholders a taste of its cash. It finally succumbed on Tuesday, saying it plans to pay out $100 billion by the end of 2015, in the form of stock buybacks and a higher dividend. That will amount to about $30 billion per year, according to Oppenheimer, which would just about take up all of Apple's "tax-free" cash flow, as he put it.

If Apple didn't borrow money, then it would have to, gasp, bring cash back home to help pay for its shareholder-greasing. And bringing Apple's offshore cash back home could result in a tax hit of up to $35 billion, assuming it pays the full statutory corporate tax rate (which doesn't happen very often). Analysts for months have been prodding Apple to borrow money to avoid the hit, and Apple has been listening, apparently.

Apple Would Rather Go Into Debt Than Bring Home $100 Billion In Offshore Cash

1). How about electing politicians who actually represent the people vs corporations?

2). How about stop buying their products?

3). So pouting is the least one can do, but any Nd everyone can do something to enact change and force Congress to correct this.

4). How about enforcing some laws that already on the books, like slapping an embargo tax on their products once they arrive into the U.S. for sale? Yes it would make their more expensive than it is already and less people would buy their product, thus losing that same amount or more in sales, thus forcing them to actually build their damn products here.

 

[tjvh]

Until the Tax code is changed, there really isn't anything you can do about it... Except pout.

 

[Mad Scientist]

Why all the complaining? This is the Globalism you all wanted. This is a result of all the Free Trade Agreements you all applauded.

 

[tjvh]

Yep... We should penalize companies like Apple even more, because it isn't like those penalties will ever get passed on to the consumer.

 

[Katzndogz]

Did no one imagine the implications for having an insane tax code designed to soak the last dime it could get? Really, did not one person think there would be repercussions, ramifications?

 

[Politico]

Why all the complaining?

Jealousy.

 

[Dont Taz Me Bro]

Until the Tax code is changed, there really isn't anything you can do about it... Except pout.

1). How about electing politicians who actually represent the people vs corporations?

2). How about stop buying their products?

3). So pouting is the least one can do, but any Nd everyone can do something to enact change and force Congress to correct this.

4). How about enforcing some laws that already on the books, like slapping an embargo tax on their products once they arrive into the U.S. for sale? Yes it would make their more expensive than it is already and less people would buy their product, thus losing that same amount or more in sales, thus forcing them to actually build their damn products here.

5). How about fixing the tax code so corporations providing jobs to millions of Americans won't get raped by the government and will bring their money back from overseas?

 

[OnePercenter]

Good for Apple! It's about time.

 

[Quantum Windbag]

Pay attention, Simpson and Bowles: There are some things in life worse than going into debt.

For Apple Inc., that worse thing is paying taxes: The company announced plans Tuesday evening to borrow money for the first time ever, despite having nearly $145 billion in cash. The problem is that $102 billion of that cash is parked overseas and would be taxed if Apple tried to use it in its plan to give money back to shareholders.

"We are continuing to generate significant cash offshore, and repatriating this cash would result in significant tax consequences under current U.S. tax law," Apple Chief Financial Officer Peter Oppenheimer said on a conference call discussing Apple's earnings for the quarter that ended in March.

Apple's earnings haven't exactly been setting the world on fire quite enough lately to satisfy finicky shareholders. So the company is under increasing pressure to give its shareholders a taste of its cash. It finally succumbed on Tuesday, saying it plans to pay out $100 billion by the end of 2015, in the form of stock buybacks and a higher dividend. That will amount to about $30 billion per year, according to Oppenheimer, which would just about take up all of Apple's "tax-free" cash flow, as he put it.

If Apple didn't borrow money, then it would have to, gasp, bring cash back home to help pay for its shareholder-greasing. And bringing Apple's offshore cash back home could result in a tax hit of up to $35 billion, assuming it pays the full statutory corporate tax rate (which doesn't happen very often). Analysts for months have been prodding Apple to borrow money to avoid the hit, and Apple has been listening, apparently.

Apple Would Rather Go Into Debt Than Bring Home $100 Billion In Offshore Cash

Could that be because the US wants to tax any money that crosses an imaginary line even if it was earned in another country?

 

[Quantum Windbag]

Until the Tax code is changed, there really isn't anything you can do about it... Except pout.

1). How about electing politicians who actually represent the people vs corporations?

2). How about stop buying their products?

3). So pouting is the least one can do, but any Nd everyone can do something to enact change and force Congress to correct this.

4). How about enforcing some laws that already on the books, like slapping an embargo tax on their products once they arrive into the U.S. for sale? Yes it would make their more expensive than it is already and less people would buy their product, thus losing that same amount or more in sales, thus forcing them to actually build their damn products here.

How about actually learning to think?

1. Politicians do not represent corporations. If they did there would be no taxes on corporations, and they would all move their offices to the US.
2. Feel free to set an example by throwing your computer away, not using any electricity, and relieving me of the tedium of reading your idiotic posts.
3. Pouting is something spoiled brats do.
4. The laws actually on the books prohibit the US from slapping punitive taxes on goods, which means you are actually advocating breaking the law.

 

[AmazonTania]

Apple has been borrowing to cover their operating expensive for years. I don't know why this is a sudden shock now.

 

[rdean]

Republicans love to protect companies that left so many Republican unemployed.

 

[AmazonTania]

Republicans love to protect companies that left so many Republican unemployed.

So instead of examining the inherent flaws of the economy and figuring out why companies like Apple chooses not to invest in a unfriendly environment like America, you make it political when it's really not...

That's not surprising.

 

[auditor0007]

Pay attention, Simpson and Bowles: There are some things in life worse than going into debt.

For Apple Inc., that worse thing is paying taxes: The company announced plans Tuesday evening to borrow money for the first time ever, despite having nearly $145 billion in cash. The problem is that $102 billion of that cash is parked overseas and would be taxed if Apple tried to use it in its plan to give money back to shareholders.

"We are continuing to generate significant cash offshore, and repatriating this cash would result in significant tax consequences under current U.S. tax law," Apple Chief Financial Officer Peter Oppenheimer said on a conference call discussing Apple's earnings for the quarter that ended in March.

Apple's earnings haven't exactly been setting the world on fire quite enough lately to satisfy finicky shareholders. So the company is under increasing pressure to give its shareholders a taste of its cash. It finally succumbed on Tuesday, saying it plans to pay out $100 billion by the end of 2015, in the form of stock buybacks and a higher dividend. That will amount to about $30 billion per year, according to Oppenheimer, which would just about take up all of Apple's "tax-free" cash flow, as he put it.

If Apple didn't borrow money, then it would have to, gasp, bring cash back home to help pay for its shareholder-greasing. And bringing Apple's offshore cash back home could result in a tax hit of up to $35 billion, assuming it pays the full statutory corporate tax rate (which doesn't happen very often). Analysts for months have been prodding Apple to borrow money to avoid the hit, and Apple has been listening, apparently.

Apple Would Rather Go Into Debt Than Bring Home $100 Billion In Offshore Cash

Could that be because the US wants to tax any money that crosses an imaginary line even if it was earned in another country?

I don't have much of a problem with the corporate tax rate, because corporations never pay anywhere close to that rate. There is a big problem though with taxing companies on their foreign profits if they choose to bring them back to the US. It doesn't even make sense. Taxes should be paid to the countries where the profits are earned, plain and simple. I would think this is something we could get enough support on from both parties that we could make this change, at least I would hope.

 

[OnePercenter]

Until the Tax code is changed, there really isn't anything you can do about it... Except pout.

1). How about electing politicians who actually represent the people vs corporations?

2). How about stop buying their products?

3). So pouting is the least one can do, but any Nd everyone can do something to enact change and force Congress to correct this.

4). How about enforcing some laws that already on the books, like slapping an embargo tax on their products once they arrive into the U.S. for sale? Yes it would make their more expensive than it is already and less people would buy their product, thus losing that same amount or more in sales, thus forcing them to actually build their damn products here.

How about actually learning to think?

1. Politicians do not represent corporations. If they did there would be no taxes on corporations, and they would all move their offices to the US.
2. Feel free to set an example by throwing your computer away, not using any electricity, and relieving me of the tedium of reading your idiotic posts.
3. Pouting is something spoiled brats do.
4. The laws actually on the books prohibit the US from slapping punitive taxes on goods, which means you are actually advocating breaking the law.

Really? Corporate taxes are the lowest (12.3 effective) in 42 years.

 

[OnePercenter]

Pay attention, Simpson and Bowles: There are some things in life worse than going into debt.

For Apple Inc., that worse thing is paying taxes: The company announced plans Tuesday evening to borrow money for the first time ever, despite having nearly $145 billion in cash. The problem is that $102 billion of that cash is parked overseas and would be taxed if Apple tried to use it in its plan to give money back to shareholders.

"We are continuing to generate significant cash offshore, and repatriating this cash would result in significant tax consequences under current U.S. tax law," Apple Chief Financial Officer Peter Oppenheimer said on a conference call discussing Apple's earnings for the quarter that ended in March.

Apple's earnings haven't exactly been setting the world on fire quite enough lately to satisfy finicky shareholders. So the company is under increasing pressure to give its shareholders a taste of its cash. It finally succumbed on Tuesday, saying it plans to pay out $100 billion by the end of 2015, in the form of stock buybacks and a higher dividend. That will amount to about $30 billion per year, according to Oppenheimer, which would just about take up all of Apple's "tax-free" cash flow, as he put it.

If Apple didn't borrow money, then it would have to, gasp, bring cash back home to help pay for its shareholder-greasing. And bringing Apple's offshore cash back home could result in a tax hit of up to $35 billion, assuming it pays the full statutory corporate tax rate (which doesn't happen very often). Analysts for months have been prodding Apple to borrow money to avoid the hit, and Apple has been listening, apparently.

Could that be because the US wants to tax any money that crosses an imaginary line even if it was earned in another country?

I don't have much of a problem with the corporate tax rate, because corporations never pay anywhere close to that rate. There is a big problem though with taxing companies on their foreign profits if they choose to bring them back to the US. It doesn't even make sense. Taxes should be paid to the countries where the profits are earned, plain and simple. I would think this is something we could get enough support on from both parties that we could make this change, at least I would hope.

I don't see any indication that Apple ever paid tax to anyone.

 

[OnePercenter]

I don't have much of a problem with the corporate tax rate, because corporations never pay anywhere close to that rate. There is a big problem though with taxing companies on their foreign profits if they choose to bring them back to the US. It doesn't even make sense. Taxes should be paid to the countries where the profits are earned, plain and simple. I would think this is something we could get enough support on from both parties that we could make this change, at least I would hope.

I don't see any indication that Apple ever paid tax to anyone.

Well?

 

[Rozman]

Sounds like Apple is making a good business decision.

 

[Rozman]

Since interest rates are so low why not borrow the money instead of taking the tax hit?

 

[AmazonTania]

I don't see any indication that Apple ever paid tax to anyone.

In Q1 they've paid $3 Billion in taxes on $43 Billion of revenue.