Apple is recently reported to be preparing to offer a huge portion of debt, with its largest corporate bond sale this year. The tech giant is known to be planning to release $18.3 billion worth of bond issuance that will be imperative for their plans to aid and fund the companies massive share buyback program.
The estimated available funds of Apple is around $US140 billion, which is made up mostly of earnings coming from overseas. Although funds that are coming from overseas are not able to be used for the companies share buyback programs, which is still subject for repatriating the cash to the United States. This also would initially be a big issue for the companies corporate tax rate payments which is at 35%.
Apple vice president, Luca Maestri, recently gave a statement to the companies' shareholders at their quarterly results meeting that Apple will definitely experience a lot of loss if the funds coming from overseas will be delivered inside the United States, claiming that US tax laws will significantly deduct taxes from those funds, and it would be the best interest of the shareholders to not undergo this process.
The Australian Financial Review, also made initial reports, that Apple is currently being intensely investigated over the ten years of minimal tax payments made by the company in Australia. The tech giant has recorded a pretax earnings estimated at $88.5 million on its current financial year operations in Australia. This is also a large part from its total revenue of $2 billion from overseas countries during the same year.
Apple is said to be planning to be more aggressive in both international and local markets this year, by executing their capital return program, with an efficient tax payment method so that they can increase a much stable and stronger balance sheet, and by accessing the debt markets similar to the move they did last year.
The tech giant strategy to use up the credit markets for its operation than moving the funds from their overseas market, is to extinguish the cost of taxes that will be initiated to the company, providing more revenue.
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