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Apple to pay $38bn in US taxes on foreign cash, open new campus

This file photo taken on September 14, 2016 shows the Apple logo at the entrance to the Fifth Avenue Apple store in New York. (AFP)
SAN FRANCISCO: Apple Inc. on Wednesday said it will make about $38 billion in tax payments on its overseas cash and plans to open a second US campus as part of a 5-year, $30 billion US 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.
About a third of the new spending will be on data centers to house its iCloud, App Store and Apple Music services. 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 US-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.

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