Say what you will about President Trump, but I like his recently passed tax law. A lot. By lowering the top corporate rate from 35% to 21%, lowering personal income tax brackets across the board and allowing companies to return money stashed in foreign subsidiaries to the US for a one time lower tax bill, the new tax law has been a huge boost to the US economy.
Companies have given employees raises, paid bonuses, rewarded shareholders and increased investments. GDP growth of roughly 3% annually is the new normal. Berkshire Hathaway reported that they received a $29bn benefit from the tax law, mainly in the form of deferred tax liabilities that are now much lower than originally calculated.
But the monster of all of them is Apple, the king of offshore cash stashes. The company had over $260 billion parked abroad and has announced plans to bring most of that money to the U.S. and pay around $38bn in one time tax to the government (which is one of the biggest single tax payments any company will ever make). At roughly 15.5% rate for returning foreign cash, that means Apple is bringing back over $245 billion. To give you a bit of a context, that’s 74% of Nigeria’s currently estimated $330 billion GDP.