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Apple to 'Contribute' $350 Billion to US Economy Over Next 5 Years

Apple to 'Contribute' $350 Billion to US Economy Over Next 5 Years
(Fotofreaks/Dreamstime)

By    |   Wednesday, 17 January 2018 02:57 PM

Apple Inc. reportedly said it will "contribute" $350 billion to the U.S. economy over the next five years.

Apple also said it will make about $38 billion in tax payments on its overseas cash and plans to open a second U.S. campus as part of a 5-year, $30 billion U.S. investment plan.

Apple said it plans a wave of investing and hiring in the United States and will create 20,000 jobs through hiring at its existing campus and the new one. It will announce the location later this year.

"Combining new investments and Apple’s current pace of spending with domestic suppliers and manufacturers — an estimated $55 billion for 2018 — Apple’s direct contribution to the US economy will be more than $350 billion over the next five years, not including Apple’s ongoing tax payments, the tax revenues generated from employees’ wages and the sale of Apple products," the company said in a news release.

Apple also said it will make about $38 billion in tax payments to bring funds kept overseas back to the United States under new federal tax laws, Reuters reported.

Apple said it expected to create 20,000 jobs through hiring at existing campuses and through opening a new campus.

"We have a deep sense of responsibility to give back to our country and the people who help make our success possible," chief executive Tim Cook said in a statement.

About a third of the new spending will be on data centers to house its iCloud, App Store and Apple Music services, Reuters reported.

The company has data centers in seven states and also on Wednesday broke ground on an expansion of its operations in Reno, Nevada, where local officials granted it tax breaks on a downtown warehouse.

The announced tax payment was roughly in line with what analysts expected from the tax bill, which requires companies to pay a one-time tax on foreign-held earnings whether they intend to bring them back to the United States or not.

Apple has $252.3 billion in cash abroad and previously had set aside $36.3 billion in anticipation of tax payments on its foreign cash, meaning the payment would not represent a major impact on its cash flow this quarter.

Apple did not indicate how much, if any, of its cash it would actually bring back to the United States.

Apple also said it would boost its advanced manufacturing fund, which it uses to provide capital and support to suppliers such as Finisar Corp. and Corning Inc., from $1 billion to $5 billion. Apple said it plans to spend $55 billion with U.S.-based suppliers in 2018, up from $50 billion last year.

Apple joins Amazon.com Inc. in scouting for a location for a second campus. Amazon finished taking applications from cities in October for its second campus.

(Newsmax wire services contributed to this report).

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Apple Inc. said it will bring hundreds of billions of overseas dollars back to the U.S., pay about $38 billion in taxes on the money and spend tens of billions on domestic jobs, manufacturing and data centers in the coming years.
cnbc, apple, billion, economy
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2018-57-17
Wednesday, 17 January 2018 02:57 PM
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