Over 100 companies have doled out bonuses to their workers, made plans to increase U.S. investment, and boost philanthropic donations since the GOP’s tax bill became law on December 22. It was a tax cut for the middle class. It was an investment in the American worker, which the Democratic Party decided to flip off. Not a single Democrat voted for this tax bill. They voted against economic growth, relief for millions of families, and job creation. This tax bill will become more popular with time—and Democrats are at risk for eating a lot of crow once people figure out that they will be saving a lot of money. In the meantime, Apple, the tech giant, is likely to repatriate $200-250 billion thanks to the tax reform legislation (via VentureBeat):
Apple has been actively preparing to repatriate over $200 billion in overseas cash since 2016. With the Tax Cuts and Jobs Act of 2017 cutting the repatriation tax rate to 15.5 percent, Apple can now bring all of its foreign profits back to the U.S. at a nearly 20 percent discount. So, how will it spend all that cash?
Since Apple will have around $250 billion more in its U.S. coffers, many people expect the company to splurge, despite its history of making small purchases. While it would be easy to write off the possibility of a single huge acquisition, based solely on Apple’s history, Tim Cook said last year that “[t]here’s not a size that we would not do, based on just the size of it. It’s more of the strategic value of it.” That comment was enough to fuel speculation about anything and everything.
With the rate that low, Cook can put his plan into action. In June of 2017, he said that the current rate was just insane, while adding that bringing back the billion on profits overseas is what’s good for the country. Up until recently, the only issue was how he could convince lawmakers to make that happen. With Trump and a Republican Congress, it happened. Here’s what Apple CEO Tim Cook said at that time (via CNBC):
Speaking to Bloomberg Businessweek, Cook said bringing that money back is "what's good for America." Cook suggested that a more reasonable percentage — 10 percent or 20 percent — repatriation should be required.
"The issue is not that there's a tax on international earnings. The issue is the existing tax has been crazy," Cook said. "No one would bring it back at a 40 percent—I mean, 35 percent federal and then state taxes. That's the problem. I think it's smart for the United States to have some kind of tax revenue for international earnings—if that tax were reasonable."
Well, Christmas came early with this tax bill for a lot of companies, their workers, and soon will be benefiting millions of Americans. For Apple, it could lead to some big acquisitions, so stay tuned.