San Francisco – Apple announced Wednesday it would pay about $38 billion in taxes – likely the largest payment of its kind – on profits repatriated from overseas as it boosts investments in the United States.
The iPhone maker said in a statement it plans to use some of its foreign cash stockpile, which qualifies for reduced tax rates under a recent bill, to invest in new projects.
A source close to the company confirmed that Apple is sharing some of the wealth with employees worldwide through bonuses of $2,500 worth of restricted shares of stock.
”Huge win for American workers and the USA!” President Donald Trump said in a tweet.
Apple, which claims to be the largest US taxpayer, is also one of the biggest beneficiaries of a tax bill passed by Congress in December which lowers the rate of repatriated profits to around 15 percent and cut the corporate tax rate to 21 percent from 35 percent.
The tech giant had built a stockpile of more than $250 billion in overseas holdings, claiming it was not in the interests of shareholders to repatriate the money with a 35 percent tax rate.
Apple said it will now use a large chunk of the overseas cash for US investments.
It said it expects to spend more than $30 billion in direct capital expenditures in the US over the next five years, creating roughly 20,000 new jobs, and claimed the move would contribute $350 billion in economic activity on home soil.
”Apple is a success story that could only have happened in America, and we are proud to build on our long history of support for the US economy,” said Apple chief executive Tim Cook.
”We believe deeply in the power of American ingenuity, and we are focusing our investments in areas where we can have a direct impact on job creation and job preparedness. We have a deep sense of responsibility to give back to our country and the people who help make our success possible.”
Apple plans to spend more than $10 billion on US data centers, which play an increasingly important role as the California-based iPhone maker focuses on increasing revenue from services and content based in the Internet ”cloud.”