Apple’s Foreign Tax Is 1.9 Percent

Records show that for the latest fiscal year, tech giant Apple paid about 1.9 percent of income tax rate for its earnings outside the United States.

This means that Apple paid only about US$713 million worth of taxes. Its foreign earnings for the fiscal year ending Sept. 29 are US$36.8 billion. Apple’s foreign earnings were bigger by 53 percent compared from its earnings in the fiscal year of 2011.

Based on financial statement that Apple filed last Oct. 31, it paid about 2.5 percent income tax for its foreign earnings in fiscal year of 2011. This is significantly smaller because the general US corporate tax rate is a 35 percent.

Apple is able to pay such a small rate because of different accounting moves where a company shifts its profits to countries where there are lower tax rates. These tax techniques are legal and are used by other multinational companies.

If Apple or any company brings home its cash, then the company would be required to pay US corporate taxes.

For the current fiscal year, Apple has overseas money worth $82.6 billion.