Apple CEO Tim Cook is pushing back against claims that the tech business is unpatriotic or fraudulent for keeping hundreds of billions of dollars in earnings overseas.
"We are the largest taxpayer in the United States. And so we're not a tax dodger," Cook said in a lengthy interview published by the Washington Post over the weekend. "We pay our share and then some."
Apple has as much in earnings held offshore as any other U.S. multinational, over $200 billion, according to the nonprofit Citizens for Tax Justice. The company has been criticized for its aggressive planning to lower its tax bill, especially its maneuver of declaring intellectual property profits in low-tax Ireland. Last month, liberal Nobel Prize-winning economist Joseph Stiglitz called Apple a "fraud" for reporting such high profits in Ireland.
Under current tax law, Apple must pay the 35 percent corporate tax rate on those earnings held overseas, allowing credits for taxes paid to foreign governments. But those U.S. taxes aren't due until the money is brought back into the U.S.
Cook said the company won't bring back those profits as long as the tax rate it would have to pay, at the combined federal and state levels, is near 40 percent.
"It's not a matter of being patriotic or not patriotic," Cook said. "It doesn't go that the more you pay, the more patriotic you are."
He added that he is optimistic about the prospects for tax reform to lower the rate on international earnings.
Members of both parties have suggested cutting the corporate tax rate on repatriated earnings. Both Democrats and Republicans have also suggested that, as part of tax reform, the estimated $2.4 trillion in profits currently held by multinationals overseas might be allowed to be brought back and only taxed at a special low rate.
In the tax reform proposal published by House Republicans in June, for example, overseas cash would have been taxed at 8.75 percent.