Apple's bond offering will allow it to avoid $9.2B in US taxes

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Comments

  • Reply 101 of 105
    scprofessorscprofessor Posts: 218member


    Who knows he might have dropped a z vette engine in that Nova. It would require abit  more imagination than Apple has had lately.

  • Reply 102 of 105
    jungmarkjungmark Posts: 6,926member
    Who knows he might have dropped a z vette engine in that Nova. It would require abit  more imagination than Apple has had lately.

    Oh please stop. Sammy imagination turned a 4.5" phone into a 5" phone. Wow. I'm so impressed. /s
  • Reply 103 of 105
    smallwheelssmallwheels Posts: 584member

    Quote:

    Originally Posted by Frood View Post


     


    Suppose you had $100billion in a bank in the Bahamas, but in order to get that money inside the US, it would be taxed.


     


    Now suppose you want $17billion inside the US for whatever reason.


     


    You could do this:


    Take $26.2 billion out of the bank in the Bahamas.  Bring it in the US.  Pay your $9.2 billion in taxes.  Voila- you have 17Billion inside the US and $73.7billion offshore


     


    OR:


    Issue a bond for $17billion. Pay 50ish million in underwriter fees and 350ish million in debt service over the life of the bond.


     


    Either way you get the same $17 billion.  The first way it cost you $9.2 billion, the second way it cost you about $400 million.  You choose.





    Does this mean that Apple is buying the bonds with its offshore money? If it is, doesn't that mean it must repay the money to the offshore entity? If that entity is located offshore Apple is still sending the money to repay the loan offshore. What am I missing about this deal?

  • Reply 104 of 105
    zoetmbzoetmb Posts: 2,655member
    trumptman wrote: »


    His point about taxation stands. Apple pays taxes when they make their products. They pay taxes when they pay their employees. They pay taxes when they earn a profit. They pay taxes again when they pay a dividend and finally they are told they should pay taxes when they move the monies that would make those profits and dividends from one country to another.

    The problem isn't that they don't pay enough taxes.

    What taxes do they pay when they make products? None

    What taxes do they pay when they issue dividends? None that I'm aware of. It's the receiver of the dividend who pays taxes.

    The only taxes Apple pays when they pay employees is their share of Social Security and Medicare. Those aren't income taxes.

    They presumably pay taxes on earnings but most Fortune 500 companies find a way not to.

    So, while I have no idea how much In income taxes Apple pays, it is not necessarily true that Apple pays a lot of taxes.

    And in a lot of their new facilities, they've made deals with the locales to avoid or reduce State income taxes.
  • Reply 105 of 105
    jungmarkjungmark Posts: 6,926member
    zoetmb wrote: »
    What taxes do they pay when they make products? None

    What taxes do they pay when they issue dividends? None that I'm aware of. It's the receiver of the dividend who pays taxes.

    The only taxes Apple pays when they pay employees is their share of Social Security and Medicare. Those aren't income taxes.

    They presumably pay taxes on earnings but most Fortune 500 companies find a way not to.

    So, while I have no idea how much In income taxes Apple pays, it is not necessarily true that Apple pays a lot of taxes.

    And in a lot of their new facilities, they've made deals with the locales to avoid or reduce State income taxes.

    They paid $6 billion dollars in corp income tax. I'm sure they also paid property taxes, sales tax on consumables.
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