Ahead of the testimony it will be giving before the U.S. Senate tomorrow, Apple (via The Loop) offered up a nicely detailed 17-page PDF document with all sorts of good information inside. The most interesting number is this: Apple pays $1 out of every $40 of income tax collected by the US Treasury. Isn’t it incredible to think that one company is responsible for 2.5% of all US income tax collection?
It’s quite popular for people reporting on Apple’s financial position to quote the absurdly high level of cash the company holds on its balance sheet. At the end of last quarter the $145 billion is more than a rainy day fund, which is why the board of directors approved a massive stock buyback and dividend hike. Of course Apple won’t be using much of its cash to do this. Instead, it raised debt. Why? Because so much of the cash -- about $102 billion -- is not on US soil. Instead this money is held in other countries.
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Each year Apple -- an many, many other tech companies -- manages to avoid billions in corporate taxes around the world and across the U.S. They do this by setting up offices and funneling money to tax-friendly places like Ireland and Reno, Nevada. Even though Apple's corporate headquarters is in Cupertino, California, having offices to collect profits and invest money in countries and state with little or no corporate tax, they legally hang on to vast amounts of profit each year.
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