american tax enforcement of the new rules: apple may not be completely happy

on december 22, the morning news, the united states congress finally approved the republican tax reform bill, which means that apple will be$252.3 billion overseas cash transfer back to the united states has become more cost-effective.

the company will use the disposable"tax holiday,"only pay 15.5% tax rate for foreign cash, rather than the previous 35%.if apple chooses to all overseas cash back to the united states, then it will pay$39.1 billion in tax, and make this assumption is not unrealistic, the reason is that the company had been set aside for this may be a$36.3 billion reserves.

but it should be noted that, according to reuters, the company may by the tax reform act one.the bill for america's corporate income derived from overseas introduced about the lowest rate of 13%, which could make apple can't continue to use after a method to reduce the tax payable.for apple, outside the patent income treatment is very important, this is because in the past decades, transfer the foreign profits has been the cornerstone of its tax affairs.

in fact, the company will be a big part of the product value are attributed to patents and trademarks and other intellectual property rights, then some of the intellectual property rights assigned to the subsidiary in low-tax countries, according to the sales to estimate the huge patent royalties.then, these royalties will return to low-tax countries such as the netherlands.and the new rules mean that apple company in which country holding patents will become irrelevant, because the company is also in accordance with the assigned to this patent income tax in the united states.

in order to further prevent enterprises assign patent overseas subsidiaries in the united states, the tax reform bill will also be in the united states patent income tax rate to 13.1%, which means that the future will have patent, apple is not assigned to a subsidiary, for transferring them to tax"safe haven"almost become unprofitable.

the ideal goal of congress is the enterprise to foreign patent redistribution to his native land, but did not provide the"tax holiday".in the final bill, there is no any clear way can make the enterprise to foreign patent back home without having to pay taxes.

tax law professor at the university of california, who served as the united states congress joint tax committee(be committee on taxation) chief ed colin byrd(ed kleinbard), said the united states congress"screwed up".congress, he thought, it may even mean that apple's total global taxes will rise.

before apple has said that the company plans to transfer part of the foreign cash back to the united states, but did not disclose the specific amount.$36.3 billion in reserves, however, means that the company plans to almost all the cash back.if apple does, then can make its all have the ability to pay off$97 billion in long-term debt.

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