Through “stateless” subsidiaries and shadow companies, Apple Inc. AAPL amassed $252 billion in offshore cash subject to foreign tax rates far lower than the U.S.’s 35 percent, according to BBC News.
In 2017 alone, the firm made $44.7 billion outside the U.S. and paid less than $1.65 billion in taxes, the BBC said. That’s about 3.7 percent.
Upon repatriation, its present foreign holdings would be subject to an $88.2 billion tax — a figure that's less than what would have been paid upon immediate repatriation, as the $252 billion represents earnings after foreign taxes.
The sum would significantly fatten the federal wallet and aid those reliant on government programs.
Here are some things the U.S. could do with Apple’s strategically avoided taxes:
Prop Up Tesla’s Model 3s
House Republicans recently proposed to eliminate the electric vehicle federal tax credit. Apple’s $88.2 billion could fund nearly 11.8 million additional payments and, in doing so, bolster Tesla Inc TSLA’s Model 3 sales.
Buy Lockheed Martin
Lockheed Martin Corporation LMT fulfills all its client orders for less than what the government pays in its annual contract. If the U.S. acquired Lockheed Martin, it could meet all equipment needs and then some, while still saving millions.
The aerospace and defense contractor’s present market cap is $89.31 billion, but earlier this year, the firm sat at $78.3 billion — and the U.S. could have bid with a $10 billion premium.
Double NIH Spending
Federal support for the National Institutes of Health was under threat earlier this year when President Donald Trump proposed an 18-percent cut. Amid the budget debates, Benzinga discovered just how critical early-stage research grants are to the biotech industry and related medical advancements.
While Congress ultimately increased spending from $31.7 billion to $36.1 billion, it could have more than doubled its investment and thereby hastened the marketing of critical treatments.
Cut The Debt
Of course, $88.2 billion barely dents the federal debt of $20,484,949,588,327.36. It’s less than half of a percent, but it’s something.
Bump UN Security Council Funding 11-Fold
The United Nations’ most recent peacekeeping budget allocated $7.87 billion to 16 operations. U.S. officials proposed earlier this year to decrease the country’s $2.25-billion contribution, but Apple’s taxes, alone, could sustain 163 more missions.
Buy European Property
The logistics are clearly problematic, but in theory, the U.S. could afford to buy both Luxembourg and Iceland, which report gross domestic products of $59.948 billion and $20.047 billion, respectively.
In fact, there are more than 130 nations with a GDP less than what Apple has allegedly avoiding paying in taxes.
Double HUD spending
Apple’s taxes could improve housing access and affordability through the Department of Housing and Urban Development, which managed a 2017 budget of $60.2 billion to address poverty and homelessness.
Related Links:
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Breaking Down What Lower Corporate Taxes Would Mean For Apple
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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