Apple Makes Record Profits, Yet Paid Just 1.9% in Tax
Last week Apple released a predictably impressive set of financial figures. For the last financial period they earned revenue of $156 billion, of which a stonking $41.7 billion was profit. These incredible results left them sitting on a cash pile of over $150 billion.
So you'd think when it comes to their tax affairs that they'd do their bit, right? Wrong. It seems that Apple are joining other multinationals such as Starbucks and Facebook in paying a tiny amount of corporate tax on the profits they earn overseas.
Apple are believed to have earned profits of $36.8bn from their overseas operations in the last financial year. The total tax they paid on that? Just $713 million. Or in other words, they paid a tax rate on their profits abroad of just 1.9%!!
Apple's figures for foreign tax appear on page 61 of its form 10k filing with the Securities and Exchange Commission (SEC).
The scary thing is, that this rate is actually falling. Records reveal that last year Apple paid an effective rate of 2.5% on their overseas profits.
Achieving this is quite something. While they, along with many other companies, channel their profits through low taxing Ireland, the tax rate on corporate profits there is still 12.5%
Many multinational companies manage to pay substantially below the official corporation tax rates by using tax havens such as Caribbean islands.
So next time you pay for an overpriced Apple product, maybe this is something to bear in mind.