Apple announced a roughly $10 billion annual dividend and a share buy-back program, designed to make use of their hundreds of billions in cash reserves. They estimate it will cost about $45 billion over the next three years. It was a fairly conservative decision by the computer maker, which would still see their reserves grow over the next several years. And they are allowing that to continue for nakedly political reasons.
Apple made an aggressive pitch for a corporate tax holiday Monday, stressing that it plans to keep more than $60 billion parked offshore until Congress makes it easier for companies to bring those profits home.
The warning from the nation’s most valuable company came as Apple announced it would pay a dividend to shareholders and buy back stock, moves that will cost about $45 billion over three years.
But Apple — which, like several other Silicon Valley titans, has spent months lobbying for more flexibility to repatriate offshore profits — said it will rely exclusively on domestic cash reserves for the transactions and will not touch the billions in profits held abroad.
“Repatriating the cash from offshore would result in significant tax consequences under current U.S. law,” Apple Chief Financial Officer Peter Oppenheimer said on a conference call.
Apple has been among the many companies angling for a repatriation tax holiday, where they could bring back their profits stashed overseas for free. They and other large corporations have spent millions lobbying for this change. And with this announcement, they’re basically using their leverage as the largest company in America to hold the country ransom and keep $60 billion in potential economic activity offshore.
This is exactly what we should have expected after the initial repatriation tax holidays years ago. Having seen that they can bend Congress to their will, corporations get greedy and want to make it happen again. The result is that the initial repatriation tax holiday did not increase revenue in the long term. It actually reduced it, because it encouraged corporations to offshore more profits and muscle Capitol Hill to let them bring back the money for free again.
The other part of this is that Apple will not use their domestic reserves to invest in people or equipment or hire more workers. They’re using it for dividends and stock buybacks, which not coincidentally is how corporations used repatriated money back in 2004. So the argument that the repatriation holiday will lead to job creation makes no sense whatsoever. Higher demand, and pretty much only higher demand, will lead to job creation.
So you have this spectacle of Apple, the richest company in the country and possibly the world, saying that they cannot survive a big tax bill on their massive profits, the same day that they announce a $45 billion program in dividends and stock buybacks.
Now that’s thinking different.




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Guess I’ll need to stop working on the un-boxing video of my new Ipad 4.
The CEOs of APPLE must have skipped history? Ever heard of WW2?
Apple must have wanted the NAZIS to win?
This is pathetic! a so call USA company not wanting to pay TAXES?
APPLE CEOs need to be carried straight to JAIL, they have forgotten that millions of brave young AMERICANS died for their company, and this is a debt that will never be re-paid
Apple must really hate USA veterans
f@ck apple. refuse to buy their products.
correct me if i’m wrong, but this is profit earned in America correct, then stashed in off-shore accounts?
meaning Apple made this $60 billion in the USA courtesy of the American consumers, then removed this cash from our Tax Base leaving our financially strapped Counties holding the bag.
if only our Corporations had the capacity for shame.
“if only our Corporations had the capacity for shame”
They do. Corporations are people, now, remember?
What, did you time-travel to October 2012 to get an iPad4?
What happened to the “Cavlan was banned” blog?
Shorter Apple:
That’s a nice S&P 500 you’ve got there, it would be a shame for anything to happen to it.
Overall S&P 500 Earnings Growth is 11.5%, But Drops to 1.0% excluding AIG & Apple
Graphic
It’s still there. I just commented in it. Linky linky.
Why does Apple hate America?
Boycott Apple
http://www.facebook.com/pages/Boycott-Apple/350260026008
According to the right wing, amnesty for illegal aliens just encourages more illegal immigration. Why wouldn’t serial tax amnesty for corporations have the same effect?
YOU AIN’T SEEN NOTHIN’ YET…..
What you are witnessing today is only a part of something that has MUTATED and in a “growth” phase cocooning like a worm to a moth – except it wasnt a worm, and it wont be a moth. think MONSTER.
Really? Yep. Apple could GIVE every family in the U.S. $1000 and still make money hand over fist with more cash than they know what to do with. That $1000 per family is what I have been warning you about for years – here and there. And I am sorry to say – IT’S JUST THE BEGINNING OF THE BIGGEST DISASTER ON THE PLANET. That cash that APPLE and other companies are sitting on was once in circulation like that water of the rivers we drink. It has been removed and is now being horded in a collection. THIS IS MUTATION PHASE I. MONSTER PHASE I. DISASTER PHASE I.
Right now, APPLE OWNS THAT CASH. AND IT’S STILL GROWING! AND DRAINING THE ECONOMY. Think. That cash was in the economy and now it’s not. Who owns the economy? Who owns that river? Who owns the lives that the waters the economy supports? Who owns your life?
That cash will continue to grow and continue to be claimed by APPLE as theirs because most people believe the economy is some independent lake or river at which everyone can drink from. THAT LAKE IS DRYING UP!
Welcome to MONSTER PHASE II. You ain’t seen nothin’ yet.
This is a transfer pricing issue. If a company makes a product in country A and ships it to country B,, at what price does it record the inventory?
If the price is very near manufacturing cost, then the markup and profit will be in B. If the transfer is near retail price, then the Profit will remain in the country of manufacture and the selling location will have enough to pay it’s bills.
Nothing like slave labor and untaxed off shoring to make the special people rich. Bad karma to buy products made with suffering. Never buy an Apple product again.
People should not be buying Apple. Apple is a a monster that should die.
never use facebook.. you should know better. when you do business with a thief, expect to get robbed.
I remember when the first of these giveaways took place. Gordon Smith, my Senator at the time and heir to a french fry empire, was one of those who pushed this string about jobs being created with the repatriated windfall. He didn’t run for another term and that was one of his whoppers that didn’t get properly super-sized, I guess. We didn’t buy what he was feeding us. (No wonder all these second helpings from corps. come in a bag with lots of napkins. Reminds me of walkin’ the dog.) To many Apples will cause the same distress in your GI tract and I’m sure the taxpayers of the good ol’ U.S. of A. will have to eat it, yet again. Why don’t the richest companies in the world hand out complimentary bags with napkins when we go to the polls and vote? They gotta know what’s going to happen on the way home.
No, these are profits from revenue earned overseas. If the revenue was domestic, they would have to report it, and Uncle Sam could go after it. But by trade treaty earnings overseas don’t have to be reported in this country, and Sam would have to go tophat-in-hand to the other countries and ask for the figures and access to the profits. Said other countries, not wanting the assets to leave their bailiwick, will tell ol’ Uncle Sam to jump in a big pond. Apple is planning to open up new ipad sales in an additional 16 countries. Each fully-equipped ipad will cost less than one share of Apple common stock on the S&P. And after Apple buys back the stock, they’ll simply sit on the capital, and turn their attention to those foreign markets.
This is why I was not happy when the diefication of St. Steven of Jobs took place when Jobs shuffled off this mortal coil.
Jobs *may* have been innovative (questionable whether Wozniak was really the innovator), and he was certainly a Marketing “genius.”
But a true “American”??? A patriot? Someone to be abjectly venerated by the serfs, whilst we bow, scrape, kowtow and tug our forelocks?????
Spare me! Jobs made good and bully for him. But at what price to US citizens? to good ole Team USA?? And Jobs was bald-faced enough to LIE outright and say it was “necessary” to offshore jobs to slave-labor sweat shops in China simply because sluggish, lazy, slacker USA workers just couldn’t “meet demand.” Well, yeah, when your *slaves,* ya know, get to go to the bathroom once in a while…. blah blah blah…
How much is “enough” for these greedy shitheads? There is *never enough* for them. NEVER. That’s why the so-called “dirty words,” regulation and taxes are needed… now more than ever.
No way, no how the so-called “market” is going to “control” the situation satisfactorily.
Let the rapine and plunder continue apace…
Why should Apple be any different. Statistics show that most big US corporations don’t pay any income taxes. Hell, we’re lucky if we don’t end up doling out to them big bucks in corporate welfare. I don’t understand what is so unusual at all, since all the MBAs that run the corps are taught in business school that their fiduciary responsibility is to the corporation, the board, the corporate structure to be trickled down to the stockholders. I’ve never heard of anyone saying they were taught they have a responsibility to the good of the greater society. Even those want to do good want their acts to be viewed as charity, not because they owe it in taxes. Seems taxes get a very bad rap. It’s almost as if corporations that pay a tax bill are viewed as substandard for being stupid enough not to know how to avoid taxes!
I’ve never bought an Apple product before.
OpenSource4lyfe, yo.
I watched a local news report last night, here in Austin, about how the City is offering about $30 million to Apple to build their new development and distribution center here.
Since when did we need to bribe businesses to do business?
thanks, hektor6766 & sratocruiser.
i went back and checked a report i cited in my post “No Cash For Criminals” and pulled out this (found in the full report):
(emphasis mine)
so the money parked overseas IS a combination of overseas profits and u.s. profits moved out of the country.
Take an economics class.
You have more local job competition, increased wages, higher local income taxes, higher local sales taxes now that you have a combination of new residents and higher wages and then of course you have greater demand for local real estate driving up real estate values and real estate taxes.
That is why a municipality will provide tax incentives to a corporation to build a new facility. Get off the couch and read a book.
Someone should throw these spoiled fuckers in jail. I’m so goddamned tired of hearing these titans whining about paying their taxes. The price we’ve paid to keep their taxes low is staggering. Fuck Apple. “Eat the Rich” will become more than a slogan, just because it’s all the poor will have left to eat after they take everything from us. Occupy Apple!
This is hilarious. it’s like watching squirrels go after an ear of corn that’s just out of reach.
Gimmee! Gimmee! Gimmee!
http://www.youtube.com/watch?v=9BC1Wq6Z0yc&feature=related
Apple is holding the US tax money hostage because IT WORKS!!!
Foxconn suicides/working conditions
http://tinyurl.com/7resqbp
Apple investment in Texas
http://tinyurl.com/7leybpr
Apple investment in North Carolina
http://tinyurl.com/odgfgo
Finally, it sure does pay to know what the fuck you’re talking about.
http://tinyurl.com/6wvsu9a
“Someone should throw these spoiled fuckers in jail.”
For what? Nothing is illegal. If you don’t like apple and want it to suffer, don’t buy their products. If enough people agree with you, apple will die. Its a consumer product company after all and it sells an elastic good which noone needs to survive.
Not paying your taxes is illegal. So they buy off Congress and make it legal. To hell with them.
Apple as always the consummate thief and cheat… I have history and know a few close friends who worked with Jobs.. and no use for him… Besides he admits it here XEROX
My Gawd! No wonder the fawning over the dead Buddhist.
Capitalism is pathetic.
Saved the best for last, eh comrade? Now, I wonder who the sucker was in that deal?
Ms. Rosalind, you might want to reread the report you are citing. It mentions Apple twice in the whole thing, first in a chart that lists corporate incomes and second in a line saying that Apple is asking for a repatriation holiday. None of the mentions are connected to the paragraph you quote.
In 2010, Apple paid an effective 24% US income tax (they paid $4.53 billion in US taxes. In 2011, they paid $8.52 billion in US taxes) much higher rate than many other US companies, especially upper income US companies.
The income Apple has outside the US comes from selling products outside the US.
Apple employs quite a few seasonal, part time and full time employees in the US abd also creates quite a few indirect jobs as well. (Yes, they create quite a few direct and indirect jobs in other countries as well, but they do it here as well.)
btw, GE has over 90 billion parked outside the US.
This is a weird attack on Apple, it used to be when Apple had assembly lines in the US, folks complained that the prices were ‘too high’ and ‘not available in large quantities’ so business buyers would not buy Apple’s products in large quantities, except for graphics departments.
Tax evasion is illegal. Tax avoidance is completely legal.
The tax code is bought. Corporations expense out much to to reduce tax liability. The devil is always in the unknown details. Like say using the tax code to coerce, penalize financially, citizens who do not purchase health insurance for any number of reasons from, a state based tax exempt health insurance corporation, treated as a public charity, which has screwed to consumers for decades or a for profit health insurance corp, controls 75-80% percent of the market? What a deal for the consumer who already wastes .80 cents of every dollar spent on gasoline?
Apple reportedly could have made IPhones in the US for 50 % profit, but made them in China. That’s enough reason to boycott them.
That, and their locked-down, overpriced, overhyped products.
-stewartm
That is simply because Apple and control-freakish Steve Jobs never opened Apple’s manufacturing. If Apple had made its OS so that it could be installed and run on any generic hardware, like MS Windows or Linux or BSD Unix can, then supply and price wouldn’t have been issues, now would it? Instead, Apple tied its OS to its hardware and locked down its hardware (those special screws, the unibody cases, the works) to prevent Apple users from doing even the simplest of repairs or replacements themselves. THAT’s the reasons behind the high prices and low quantities.
-stewartm
You are mistaken in your claims.
The OS (operating system) is open source, called Darwin, it is free, you can install it on a variety of hardware setups. The GUI (graphical user interface) is what Apple restricts to their own hardware — that makes sure it actually runs on the hardware. Should you really push it, there is a thriving online community (look up Hacintosh) that will show you how to get the GUI part running on generic computers.
The price of the complete OS and GIU package has never been very high, the most any Apple OS and GUI package has cost is $129 — without needing any special phone home license numbers — compare that to the ‘generous’ terms offered by Microsoft, which are not. Nowadays the complete OS and GUI costs around $49..
Also, your claim about the hardware lockdown is misleading. Open up a Mac Tower computer. Making internal equipment changes does not get easier. Adding memory to any Mac machine that can actually use it is straight forward. Yup the iPhones and iPads are sealed pretty tight, but most folks do not want to open them up. As well as most folks do not want to replace motherboards on their computers, so those are a bit more harder to get at.
Lastly, now pay attention to what is written. the complaints about about the high prices and low quantities were from the older times when Apple had assembly lines here in the US. Not now, then. Long before the idea of unibody computers was even thought of. Now the prices are low and requested quantities are available.
That makes no sense. The GUI doesn’t run the hardware, the OS does. In fact, you can run GNOME and KDE or Enlightenment on a Mac.
Even just to change a battery? I think most people can handle that. In fact, Apple has been accused to trying to plan obsolescence into their products by their hardware lock-outs.
According to Wiens, the special screws prevent owners from upgrading or repairing their machines themselves. They also encourage users to replace their devices sooner than they would if they were more easily serviceable.
Locking people out of their own hardware helps contribute to our e-waste problem, no?
I *was* talking about then. The very reason why MS beat Apple in the war over the desktop was largely due to the fact you could run Windoze on any machine, whereas to run Apple’s OS you *had to buy a Mac*. Given the absolute crappiness of the early Windows versions, Apple had the advantage. But they were greedy. MS won out because Windows represented both economy and freedom–a stilted, limited, type of freedom, to be sure, but more freedom nonetheless.
I predict that that past might repeat itself with tablets and smartphones, for the same reason.
Apple’s parts are pricey for no other reason than greed. That is the reason that their capitalization briefly exceeded Exxon-Mobil’s. I have a friend who builds gaming boxes (Windows machines) from parts. Usually, building a computer costs him c. $2000. Once, for fun, he went to Apple’s site and tried to price an equivalent gaming computer for a Mac–and it ran anywhere from $5000-$6000.
Apple’s business model appears to me to simplify computing as much as possible (the “walled garden”), turning computers into appliances–increasingly which the user does not really control or own–and then to make their (upscale income) customers feel superior for having use them. This snob appeal strikes me as weird as the people I know who tend to run Macs are those who know very little about computer hardware or software, less than Unix/Linux users and even less than a lot of Windows users.
-stewartm