President Trump’s tax cuts could be YUGE for Apple

“For Apple and other Silicon Valley tech companies, tax cuts proposed by President Donald Trump and the Republicans could be huge,” Levi Sumagaysay reports for The Mercury News. “The framework that will act as a jumping-off point for Congress to revamp the U.S. tax code includes a proposal to cut corporate taxes to 20 percent from the current 35 percent, and language about making changes to ‘[stop] corporations from shipping jobs and capital overseas’ and reducing taxes on foreign profits.”

“Apple alone holds $231 billion overseas, or 94 percent of the $246 billion cash hoard the company had as of the end of 2016,” Sumagaysay reports. “As they sought to avoid repatriation taxes, the total amount of cash held overseas by U.S. companies climbed to $1.3 trillion at the end of 2016, up from $1.2 trillion in 2015, Moody’s said.”

Apple CEO Tim Cook and U.S. President Donald Trump at tech summit in June 2017
Apple CEO Tim Cook and U.S. President Donald Trump at tech summit in June 2017
“The proposal says: ‘The framework transforms our existing ‘offshoring’ model to an American model.’ It says it will do that by ‘taxing at a reduced rate and on a global basis the foreign profits of U.S. multinational corporations,'” Sumagaysay reports. “Apple CEO Tim Cook made quite a statement of his own last year about his company’s cash hoard. He said during an interview with RTE radio in Ireland that the company had ‘provisioned several billion’ for the purpose of repatriating profit to the United States this year.”

“Apple has long advocated for lower taxes on profit made outside its home country,” Sumagaysay reports. “In 2013, Cook and other Apple executives were called to testify before Congress about the company’s tax avoidance. Cook said, ‘Apple pays all the taxes we owe,’ and called for tax reform.”

Read more in the full article here.

MacDailyNews Take: As proposed, this would be the most sweeping U.S. tax reform since President Reagan.

The most significant piece for big corporations would be the switch from a worldwide tax system to a territorial tax system for multinationals which would also include a repatriation tax holiday at yet-to-be-determined rates allowing U.S. companies to finally bring offshore profits back home.

As we’ve been saying for many years now, the U.S. corporate tax rate is obviously way too high.

Under the current U.S. corporate tax system, it would be very expensive to repatriate that cash. Unfortunately, the tax code has not kept up with the digital age. The tax system handicaps American corporations in relation to our foreign competitors who don’t have such constraints on the free flow of capital… Apple has always believed in the simple, not the complex. You can see it in our products and the way we conduct ourselves. It is in this spirit that we recommend a dramatic simplification of the corporate tax code. This reform should be revenue neutral, eliminate all corporate tax expenditures, lower corporate income tax rates and implement a reasonable tax on foreign earnings that allows the free flow of capital back to the U.S. We make this recommendation with our eyes wide open, realizing this would likely increase Apple’s U.S. taxes. But we strongly believe such comprehensive reform would be fair to all taxpayers, would keep America globally competitive and would promote U.S. economic growth.Apple CEO Tim Cook, May 21, 2013

MacDailyNews Note: Please keep the discussion civil and on-topic. Off-topic posts and ad hominem attacks will be deleted and those who post such comments will be moderated/blocked. Permanent loss of screen name could also result.

SEE ALSO:
GOP tax plan calls for cutting the corporate tax rate from 35 percent to 20 percent – September 27, 2017
Goldman Sachs sees $1 trillion in U.S. tax cuts coming – September 20, 2017
Apple will eventually bring billions of dollars back to the U.S. under President Trump’s tax reform plan – July 21, 2017
President Trump’s tax reform plan includes deep cuts in corporate taxes – April 26, 2017
Apple could be primed for profit explosion under President Trump’s big tax cut – April 26, 2017
Analyst: Apple could double dividend, buy Netflix with repatriated cash under President Trump’s U.S. corporate tax changes – March 17, 2017
Apple raises $10 billion in debt ahead of President Trump’s repatriation tax plans – February 3, 2017
After Apple’s blowout earnings, the Street looks toward ‘iPhone X’ and President Trump’s tax reforms – February 3, 2017
President-elect Trump’s corporate tax reform expected to have some positive impact on Apple EPS – January 14, 2017
Exploring Apple’s tax situation under U.S. President Donald Trump – November 21, 2016
Morgan Stanley: Apple stands to benefit the most from President Trump’s corporate tax plans – November 11, 2016
Apple and U.S. President-elect Trump: Can a tax cut for overseas cash heal wounds? – November 10, 2016
Donald Trump plan calls for cuts in corporate taxes, personal income tax rates – August 9, 2016
Barring a tax holiday, Apple will need to raise over $50 billion in debt the next 2 years – July 15, 2016
Cramer: Apple’s Tim Cook is ‘patriotic’ on taxes – December 21, 2015
Apple CEO Tim Cook is absolutely right – and wrong – on U.S. corporate tax policy – December 20, 2015
Apple CEO calls corporate tax rap ‘total political crap’ – December 18, 2015
Apple avoids $59.2 billion U.S. tax bill – October 7, 2015
U.S. companies now have $2.1 trillion overseas to avoid corporate taxes – March 4, 2015

100 Comments

    1. Not my president. Racist, malignant narcissist, can’t fool me, can’t bribe me. No redeeming virtues whatsoever. He must be impeached and imprisoned, then die and rot in Hell. Nazis look the other way- they also only care about tax cuts, their privilege, their so-called supremacy. What a disgusting country we’ve become on the eyes of the world.

      1. Part of the beauty of the American system is that the sitting President is the President of ALL Americans!

        Blind refusal to recognize and acknowledge the truth does NOTHING to change that truth.

        Welcome to the Trump Presidency, blind fools!

        1. Is that what you said about the former president? Because here on Political Non Apple News, I could have sworn there are a half dozen resident trolls who did nothing but slander the former president every day for 8 years. Seems like y’all dish it out but ya cant take it.

            1. No, technically the president doesn’t represent you. Your representative and your senator represent you. The executive is supposed to manage the bureaucracy and execute the law. If you weren’t so busy being argumentative, you would recognize that fact.

            2. The president has never been my representative. My congressmen (sometimes congresswomen) and senators are my representatives. The president represents the United States to the rest of the world. That is what I was taught in school. How was that wrong?

          1. slander |ˈslandər|
            noun Law
            the action or crime of making a false spoken statement damaging to a person’s reputation…

            there was no false spoken statement about that treasonous goddamned muslim POS…see you in court.

            1. Yeah, this is why MDN is losing readership. It bans people who ask them to rein in the politicrap slung around by longstanding trolls.

              Rename the site since you don’t seem to care about the Mac or anything the executives at Apple do.

            2. I look at all tech sites from strictly a user’s perspective. The executives can service themselves for all I care, and I don’t hold stock. Not just Apple, anyone.

              I own a Mac, a Hexacore 2013 Pro. That’s my extent of caring, it’s what the mini should be.

              As far as Botty, I think I set the “bar” properly.

            3. Trumpo’s payback to his rich friends is a classic bullshit republican thing to do. None of you fuckers make enough dough to qualify for this. And, The US maximum corporate tax rate is equivalent to every other industrialized nation. Its effective tax rate is below the rest of the industrialized world.

              So take the 13¢ you get extra and buy yourself a blowjob.

            1. I’m glad you agree that a castle is a rook. Now there is no need to add an personal insult to that, so I’m going to ask you for the third and last time to cease and desist with the practice, unless of course you are not ready able or willing to act like a civilized human being.

            2. Or what, you’ll toss out some more gutless cowardly ad hominem attacks? Bring it on botty, you certainly have no interest in fact, civilized conversation just attack attack attack, that’s what your nation does, and has done since 1776.

              I can see why MDN’s recent statement about being civil and keeping to the target is lost on you, thanks for pointing it out.

              Keep attacking, we’ll bless a couple more hurricanes for you,

            3. Your hypocrisy is transparent and disgusting, frankly.

              You use MDN guidelines to browbeat others into acting civil and then you do the opposite when you call Americans terrorists living in a terrorist nation.

              I find your description of the U.S. uncivilized, offensive and hypocritical. Certainly clueless not to recognize your own folly.

              Enough with the terrorist nation crap! Been reading the same TIRED MEME from you for years.

              Now pay attention. We are liberators all over the globe for over a century. Not to mention the most generous country in the world helping other nations in times of crisis.

              Obviously, you don’t have a clue about how GOOD the USA is as a nation and its citizens. Your tired meme is MEANINGLESS … 🇺🇸👍🏻🇺🇸👍🏻🇺🇸

      2. As a conservative, I value lower taxes and welcome the possible reduction. Also, as a conservative, it’s bittersweet as there’s no mention, no effort, or forecasted legislation to deal with the debt. It’s commonplace for the libs, and it’s becoming so for the conserves. (Could someone please give auramac some assistance? Something is going to blow.)

        1. So let’s talk kitchen table economics then.

          The farm is in debt.
          Crop yield has been okay but your equipment is old and needs repairs.
          The other farm down yonder is bigger and has more workers, so you have started buying their stuff to keep yours afloat.
          Your kids don’t really want to work that hard, but even the go getters can’t seem to find meaningful work so they struggle with multiple dead end jobs.
          Your aging parents live with you to save money because they have fast rising health costs.
          Several ranch hands you have working for you, born and raised locally by undocumented parents, are super hardworking but are planning to leave because after many years of trying to legally become a citizen, the red tape hasn’t budged and he feels personnally threatened by the emboldened bullies in town.

          So the head of the farm seeks advice from the rich politician over in DC, and this is what it boils down to:

          Tel them you care about them, but don’t spend anything to help them. Let your kids and parents fend for themselves.
          Deport your dependable workers.
          Stop selling your crops overseas.
          Badmouth the other farmers, you’re in it just for yourself.
          Don’t take ecological care of your fields, just invite oil prospectors to drill exploratory holes everywhere.
          Build a very imposing fence around your farm.
          Stop milking your cows and shearing your sheep because you know they just don’t like to help support the upkeep of the farm.
          Be especially lenient on the biggest pigs, because somebody theorized once that the fatter the pig, the harder the little piglets will strive to make quality bacon.
          Finally, while your broken down tractors sit unattended because you don’t staff up and spend money on making the farm more efficient and modern, then take out a second mortgage so you can buy the newest fanciest big chrome pickup truck that you can parade around town in.

          Now that is one hell of a recipe to make Trump Farm great again.

    2. Goeb, you might want to get some facts before running up your mission accomplished banner.
      http://thehill.com/policy/finance/353126-analysis-tax-plan-would-cost-24t-benefit-wealthy-most

      Just proves again that Trump is uninformed, incompetent, or a serial liar. Or all of the above. It didn’t take long for the tax experts to expose the corrupt self-serving Trump tax plan for the pile of lies it is. Trillions in debt, no way the economy could ever grow fast enough to cover it. Games to fool the dumbest taxpayers, while the richest receive the bulk of the cuts.

      If there was ever a way to make America weaker and less able to complete in the world economy, corporate welfare and handouts to billionaires is the fastest way.

      1. You new around here? Another instant FAKE avatar. From the article:

        “This so-called study is misleading, unfounded, and biased. TPC makes a variety of overreaching and unrealistic assumptions about policy decisions Members of Congress still have to make as we draft pro-growth tax legislation,” he said (Rep. Kevin Brady).

        TPC’s analysis did not use “dynamic” scoring that takes into account the economic effects of the proposed tax changes. Republicans say that scoring takes into account the broader impacts of tax cuts on the economy.”

        More:

        “The group’s analysis is PRELIMINARY, as the revenue and distributional effects may change as Congress fills in the details of the tax framework.”

        Without “dynamic scoring” the analysis is using the same old, same old methods much like the polling methods predicting an 80% chance up to Election Day Hillary would win.

        You worried about adding to the deficit? Where were you the last eight years when it doubled? Hypocritical, for sure …

  1. Little or no specifics from Trump and anyone who thinks the final result, if there is a bill passed, will resemble yesterday’s PR charade is a moron.

    To get something passed he has no choice, but to make deals with the Democrats and the idea that breaks should go to those earning over $500,000 is an outright betrayal of the people who voted Trumo in.

    Chuck and Nancy have already booked dinners at the White House while they laugh their asses off.

    1. Oh details are very easy to find… if you are really interested. I suspect you just wish to condem whatever the plan is, so carry on.

      _————_———— but if you’d like some details….

      Here’s what is in the initial version

      Business tax changes:

      A 20% corporate tax rate. This is the first time Trump has publicly backed down from one of his earliest campaign promises: a 15% corporate tax rate. The budget math required for a 15% rate was too difficult, so the somewhat higher rate is the opening bid. The current statutory federal rate is 35%.

      A 25% rate for pass-through businesses. Instead of getting taxed at an individual rate for business profits, people who own their own business would pay at the pass-through rate. The plan also says it will consider rules to prevent “personal income” from being taxed at this rate. Mnuchin previously suggested there may be limitations on what types of businesses get this rate — it could apply only to goods producers and not service-oriented companies to prevent people from creating limited-liability corporations to store their assets and receive a lower rate.

      Elimination of some business deductions, industry-specific incentives, and more. There are few details, but the plan includes language regarding the “streamlining” of business tax breaks.

      A one-time repatriation tax. All overseas assets from US-owned companies would be considered repatriated and taxed at a one-time lower rate — this is designed to bring corporate profits back from overseas. Illiquid assets like real estate would be taxed at a lower rate than cash or cash equivalents, and the payments would be spread out over time. While there is no precise number in the plan, officials have indicated the rate could end up somewhere around 10%.

      Personal tax changes:

      A bottom individual tax rate of 12%. The plan specifies three tax brackets, with the lowest rate being 12%. That would represent a slight bump in the bottom bracket, which is now 10%. People currently in the 15% marginal tax bracket would most likely be included here.

      A middle tax bracket of 25%. The incomes in this bracket aren’t specified.

      The top individual tax rate of 35%. The current top rate is 39.6%.

      The possibility of a fourth, higher bracket. Because of Trump’s insistence that taxes for the wealthiest Americans not decrease, the plan proposes the possibility of a fourth tax bracket at a rate higher than 35% if the tax-writing committees wish. “An additional top rate may apply to the highest-income taxpayers to ensure that the reformed tax code is at least as progressive as the existing tax code and does not shift the tax burden from high-income to lower- and middle-income taxpayers,” the plan reads.

      A larger standard deduction. To avoid raising taxes on those currently in the 10% tax bracket, the standard deduction for all taxes would increase to $12,000 for individuals (up from $6,350) and $24,000 for married couples (up from $12,700). These are slightly less than the doubled deductions expected — and as Business Insider’s Josh Barro noted, the idea that this would save people money may be misleading since it eliminates other personal deductions and a secondary standard deduction.

      Eliminates most itemized deductions. The only deduction preserved explicitly in the plan is for charitable gifts and home-mortgage interest.

      Repeals the alternative minimum tax (AMT): The tax, which forces people who qualify due to an outsized number of deductions, will be eliminated. Incidentally, Trump’s own tax bill has been shown to be millins of dollars more due to the AMT.

      Increases the size of the child tax credit. A pet project of Ivanka Trump, the proposal is to make the first $1,000 of the child tax credit refundable and increase the income level at which the credit would phase out.

      Vague promises on retirement savings and other deductions. Sections of the plan refer to retirement savings and other “provisions,” but details are sparse.

      Elimination of the state and local tax deduction. The so-called SALT deduction allows people to deduct what they pay in state and local taxes from their federal tax bill. Most of the people who take this deduction are wealthier Americans in Democratic states — about one-third of the beneficiaries are in New York, New Jersey, and California.

      Elimination of the estate tax. Called the “death tax” in the plan, this applies only to inherited assets totaling $5.49 million or more in 2017. Very few households pay the estate tax, but it has long been a target for Republicans.

      1. I am quite familiar with their outline and in support of most of their goals. So your “suspect” comment is just more of your typical typecasting BS and given you are far less entertaining or intelligent than Botty, you need consider a new line of work or be a bit more careful about who you point your lectern at.

        You immediately made a whole host of assumptions about me. Almost as quickly, you betrayed your feigned intelligence with your second sentence.

        What I am is a political realist who is extremely familiar, (via direct experience with the process) with what it takes to pass a bill that can not be shoveled through under the “budget reconciliation” scam (practiced by both parties).

        Your lecture is unnecessary and quite childish. It only further broadcasts your weaknesses and somewhat obvious insecurity and mild ego mania. Most of the readers of this site don’t really know too much about the real world and the marriage of politics and government. You have anointed yourself as their professor. It may play well with them, but really Mac, with me you’re not dealing with that animal. So perhaps you should change your tactics or pick one of your usual targets to lecture.

        About 1500 years ago, a very wise man said (and I paraphrase him) the worst/most ignorant thing you could do when dealing with another person/dilemma was to underestimate them or make assumptions regarding them, their positions and their strategies. In your little lecture, you did that at lest a half a dozen times.

        1. “you are far less entertaining or intelligent than Botty..”

          you ignorant jackass, theloniousmac was an audio engineer for Motown in their heyday while you were just discovering how the high speed button on your vibrator worked.

          you insipid cow.

          1. Please Botty. That means little or nothing regarding his intelligence with respect to the topic or his arroganc lectures. And you know better than pull your act with me. I’m sure your groupies enjoy the routine, but you can be assured I couldn’t give a rat’s ass.

      2. I forgot to add … You didn’t address any of the points I raised other than to copy and paste their publicly released outline of what they will take to the appropriate congressional committees.

        You also forgot to comment on the significant increase in the debt that all sides predict this plan will happen. How could a self-anointed conservative as yourself ignore that? Or are you going to claim it’s a guarantee the economic expansion/trickle down will cover $6-$20 trillion on increased deficits? Did you know the only tax cut that produced empirical and validated evidence of growing the economy was Kennedy’s investment tax credit?

      3. I question whether “most of the people who take [the state and local tax deduction] are wealthier Americans in Democratic states.” Anybody in any state who itemizes deductions is taking this one.

        If you own your home, you are deducting both the home-mortgage deduction and the taxes on the property (as well as your other income or sales taxes). That almost always results in a lower tax bill than taking the standard deduction. There is no point in eliminating one homeowner deduction but not the other, aside from the desire to offset the hit on the federal treasury from the substantial revenue cuts in the proposal, few of which really benefit the average home owning American.

        The effect of eliminating the SALT deduction is a substantial increase in total tax payments for a whole lot of people who aren’t wealthy, because state and local taxes will now have to be paid from post-federal tax income, not from pretax income. The increase in the standard deduction won’t help unless the loss of deductions forces more of us to take the standard instead of itemizing.

        Our higher tax burden will help subsidize the cuts focussed on the top percent or so of American households. This plan is good for them, but not so good for me.

        To keep more on point (this is an Apple site), the “repatriation tax” really isn’t. It will be a simple tax on assets held by any American company overseas, whether they are repatriated or not, even including assets like overseas real estate that cannot be repatriated. The hope is that the money will be moved home to avoid dual taxation, but there is no guarantee that other countries won’t reciprocate by taxing assets sited in America. In any case, it means that Apple’s business decisions will continue to be dominated by tax considerations rather than business logic.

  2. Rich guy gives HUGE tax break to other rich guys.

    In the meanwhile ordinary citizens have to do with third-rate infrastructure, underfunded education systems, poor healthcare (that the rich guys want to scrap completely), reduced services (especially police), etc.

    Rich guys pay a fraction of the tax ordinary citizens pay.

    All the nternal problems the US has could be solved if the rich guys PAID THEIR FUCKING TAX instead of asking for tax breaks.

    “Only poor people pay tax.” … Extra points if you can name the rich bitch who said that …

      1. “The Committee for a Responsible Federal Budget estimates the Trump plan will add between $3tn and $7tn to the $20tn national debt over the next decade. To offset that, the Trump administration has proposed $5tn in cuts to non-military spending, meaning things like schools, Medicaid, social security and disability insurance.”

      2. Trump tax plan for ‘average Americans’ would mainly help richest 1%, study finds

        Trump announced a radical overhaul of the US tax system on Wednesday, claiming the plan would bring relief to middle-class households. But according to a study released by the Urban-Brookings Tax Policy Center, the average cut to most households would be just $1,700 by 2027 – and one in four households would actually pay more tax.

        Households making more than about $900,000 a year, however, would see their taxes drop by more than $200,000 on average.

      1. an inconvenient truth, and until justice prevails, until the treasonous actors of The Plantation Party and GOPinc. are brought to court by due process, it will continue. Trump’s worst mistake was Sessions, he is not an attorney general in the ilk of Robert F. Kennedy, he is Colonel Cornpone & The Reefer Madness Militia…

        a goddamned joke. Felonia von Pantsuit should be before a grand jury this very day.

        1. Oddly, I respected Jeff Sessions for recusing himself from the Russia investigations, and was troubled when Donald Trump disliked that he did that.

          Not that you care what I think. Even though Michaele thinks I’m one of your uncountable groupies.

            1. Oddly, I respected John McCain for voting his conscience on the ACA. I am morally certain that it was his conscience, and not because Donald Trump strung him up like the Viet Cong to twist in the wind.

            2. Not that any of us is keeping score, but…

              John S. McCain III — Silver Star, Legion of Merit (twice), Distinguished Flying Cross, Bronze Star (3 times), Purple Heart (twice), Meritorious Service Medal, Air Medal (twice), Navy Commendation Medal (twice), various combat service medals (nine times), and three Republic of Vietnam medals (including their highest honor).

              Donald Trump–Attended a military school, but avoided actual military service by claiming he was disabled by bone spurs that had not kept him from playing three varsity sports in high school or from remaining active in college intramural sports.

              The Forrestal fire was well documented both at the time and later. No contemporary account credits McCain with any cowardice OR stupidity.

  3. relying on an impulsive moron with no working knowledge of the U.S. tax code (other than how to keep the public from seeing his own returns) seems like a bad plan for cutting your own taxes

      1. Golfing 25% of his days in office so far, and zero legislative coordination success. Busy tweeting about the NFL during his daily television session without realizing that a US territory was being clobbered by a hurricane.

        What are you smoking?

          1. I do agree with that tenet, but only conditionally. How rich is he? Surely not as rich as King Midas.. we haven’t seen his tax returns. As to being unbuyable, that depends on the commodity. What if Putin has, uh, tapes? They’d be worth a few rubles, translated into diplomatic inaction. Just sayin’. Just because you approve of his broad policies, and are energised by his trashing of liberal norms, and has a personality like yours, doesn’t mean he isn’t hiding a few dimes. As Hunter S. Thompson admitted, doesn’t everybody do that?

            1. Thompson was a real man, unafraid to LIVE. He was also a man that examined other men’s beliefs as though they were failed experiments in a petrie dish, or squalid excuses for moral turpitude. I found him rather exciting, compared to the tepidity on offer hereabouts.

        1. The vid you posted was a much needed response in this debate and not surprising sane reaction when you consider the Packers are the only team in the NFL owned by the PEOPLE.

          Despite the media bias, feels good sanity still reins and we saw that tonight.

          USA! USA! USA! 🇺🇸

            1. The other night Ryan was on FOX NEWS with printed charts making the case the House under President Trump passed more bills at this time in a new presidential administration than several administrations prior.

              Great. But working with the Senate to get bills on the president’s desk is far more important …

  4. MDN: Are you even looking at the crap thats being spewed here? ”Please keep the discussion civil and on-topic. Off-topic posts and ad hominem attacks will be deleted and those who post such comments will be moderated/blocked. Permanent loss of screen name could also result.”

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