San Francisco: Apple, which had long deferred paying taxes on its foreign earnings and had become synonymous with hoarding money overseas, unveiled plans on Wednesday that would bring back the vast majority of the $252 billion in cash that it held abroad and said it would make a sizeable investment in the US.
It said it expects to pay about $38 billion in taxes for the horde of cash it plans to bring back to the United States.
Over $10 billion of Apple's expanded capital expenditures will be investments in data centers across the US.
Apple which falls on the list of the top 10 world's largest companies in terms of revenue, has recently announced a series of new initiatives to show its commitment to supporting the USA economy and workforce.
The new law lowers the corporate tax rate to 21 percent on U.S. profits while providing a sharper discount on overseas cash this year.
Apple, like many other United States multinationals, has large amounts of money held overseas.
Tim Cook is a liberal who probably doesn't like taking a step that makes President Trump look good. Shareholders will also benefit from the lower effective tax rate, granted through the changes to the tax code.More news: India Summons Pakistani Deputy High Commissioner Over Truce Breaches in Kashmir
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Most of that $350bn reflects money that Apple planned to spend with its suppliers and manufacturers in the United States anyway, even if corporate taxes had stayed at the old 35 percent rate. Over the last decade, Apple has invested billions of dollars in data centers and co-located facilities in seven USA states, including North Carolina, Oregon, Nevada, Arizona and a recently announced project in Iowa. Since, the company didn't disclose the location where the facility will exposed.
While Apple has announced no plans to change that practice.
Apple's new campus wouldn't be called its "second campus" and is highly unlikely to compete with its headquarters at 1 Infinite Loop, or its new $5 billion headquarters, Apple Park, both in Cupertino, California.
While large parts are not a result of the tax bill, for purposes of this analysis, we are going to assume that they are entirely due to the tax cuts, so there are no disputes with the following analysis due to not fully attributing the announced jobs, bonuses and investments to tax cuts.
The technology giant also revealed it expected a oneoff repatriation tax payment of $38bn as part of recent changes in USA tax law, representing by far the biggest payment of its kind to date.
Like many other big companies, Apple had pushed the tax avoidance game too far.
"Apple is a success story that could only have happened in America, and we are proud to build on our long history of support for the U.S. economy", Tim Cook, Apple's CEO said. They must pay tax whether they bring the money back to the country or not.