The tax strategies of big US pharma companies are all pretty similar. Big US tech companies have more varied strategies - but still book too many profits in low tax jurisdictions abroad to ignore.
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cfr.org
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cfr.org
There are a set of US technology companies that did return the profits on their offshored intellectual property to the United States to take advantage of the low Foreign Derived Intangible Income (FDII) rate (13.125%).
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Google's tax transformation in 2020 is easy to spot -- it now books almost all of its profit in the U.S.
And Nvidia appears to have moved to a "FDII" based tax structure as well, and it is finally paying a bit of US tax
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And Nvidia appears to have moved to a "FDII" based tax structure as well, and it is finally paying a bit of US tax
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But there is no consistent tax move onshore by Big Tech. Apple has retained its Irish tax subsidiary/ tax structure, and after the Tax Cuts and Jobs Act, it consistently pays more tax offshore than in the US ...
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And Apple is so profitable that its offshored (essentially Irish shored) profit is roughly the same as all of "Big Pharma"
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Like Apple, Microsoft has retained an Irish centric tax structure for its foreign profit (and thus has a "GILTI" not FDII based US tax structure). Its onshore profit is slightly higher than its offshore profit now, but its offshore profit is immense.
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So it is no accident that Apple and Microsoft are the largest two corporate tax payers in Ireland, and are now essentially financing the creation of Ireland's sovereign wealth fund.
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The offshore (& essentially Irish) profit of Microsoft and Apple is around $100 billion combined, or about a quarter of the total profit that US firms collectively book in low tax jurisdictions (per the BoP). The lost US tax revenue is immense -- on the same scale as Pharma
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