Friday, November 4, 2011

As they lobby for a tax holiday, some big multinational players say they've got plenty of cash on hand

The Center for Public Integrity




By  and ,

Posted: 11/4/11 09:58 AM ET

As select U.S. multinational corporations push for a tax holiday on a trillion dollars parked overseas, their own recent financial reports undermine the arguments they are making for preferential treatment on Capitol Hill.
Proponents of the tax break for "repatriated" overseas earnings say that bringing the money home will give U.S. corporations an infusion of cash, stimulating investment and creating jobs.
But an iWatch News survey of some major players in the tax repatriation debate found that corporations, far from being cash-starved, are sitting on billions of dollars of liquid assets. In new filings with the Securities and Exchange Commission and conference calls with Wall Street analysts, some big players flatly say they don't need the tax holiday.
Firms like Microsoft and Oracle, Google and Apple have tens of billions in cash stashed offshore, and lots more here at home.
"We currently do not intend nor foresee a need to repatriate these funds," the Microsoft Corp. said in itslatest quarterly report . "We expect existing domestic cash, cash equivalents, short-term investments, and cash flow from operations to continue to be sufficient."
Microsoft said it had $57.4 billion in cash and other liquid sources on hand, with $51 billion of that kept overseas.
Though it rests in offshore accounts, the lion's share of Microsoft's money is already invested in U.S. assets. The firm says it has socked 83 percent of the billions it holds offshore in U.S. government securities, U.S. corporate bonds and U.S. mortgage-backed securities.