Apple is likely to win big under the tax plan that Republicans are pushing through Congress, according to the Financial Times.
The Cupertino, Calif., firm could make as much as $47 billion in additional profits from the tax legislation, according to the paper's estimates.
The Senate version of the tax proposal, which would allow Apple to bring home profits it has stashed overseas at a maximum 14.5 percent tax rate, would be a huge discount over the proposed 25 percent corporate tax rate, and an even bigger deal than the current 35 percent rate.
Apple isn’t the only company that stands to significantly benefit from the legislation. It does, however, stand to gain the most, as it has almost double the amount of profits overseas as the next closest firm, Microsoft. The Seattle-based software firm keeps $132 billion overseas, compared with Apple’s $252 billion.
Under current tax laws, Apple would have to pay $78.1 billion to bring its profits back to the U.S. Under the Senate plan, on the other hand, Apple would only have to pay $31.4 billion on its past overseas earnings, Richard Harvey, a tax professor at Villanova University told the Financial Times. Harvey has testified before Congress regarding Apple’s overseas holdings.
That difference equals $47 billion in savings, which is more than any other U.S corporation makes in profits annually
Apple has signaled that it would only return half of its overseas profits back to the U.S. and of those, it would likely hand that money to its shareholders in the form of dividends and stock buybacks, instead of jobs and investment as members of the GOP claim.
“Overall, companies like Apple will be happy with it. They are a getting a territorial system and a lower rate. It’s a good deal,” Harvey told the Financial Times.