The amount of repatriated profits that have returned to the U.S. as a result of President Trump’s massive tax overhaul has been modest and just 3.5 percent of what the president predicted, the Wall Street Journal reports.
The revamp ended the practice of taxing U.S. firms when they brought home foreign profits “trapped” abroad. Companies long complained of high taxes in the U.S. and held their cash in foreign subsidiaries to avoid additional taxes.
The Republican tax law that Trump signed in December imposes a one-time tax on those old earnings, regardless if that money is repatriated or not. It also removes federal taxes on future repatriations and makes future foreign profits generally tax-free in the U.S.
Trump said last year: “Over $4 [trillion], but close to $5 trillion, will be brought back into our country. This is money that would never, ever be seen again by the workers and the people of our country.” But an analysis by the Wall Street Journal shows just $143 billion has been repatriated or 3.58 percent of the president’s $4 trillion prediction.
Two-thirds of the money already brought back came from just two companies: networking-equipment giant Cisco Systems and drugmaker Gilead Sciences.
Many companies that held some of the biggest foreign cash piles before the GOP tax reform, including Microsoft Corp. and Alphabet Inc., provided no information about what it was doing with the funds.