Tuesday, May 21, 2013

Largest Charlotte companies keeping $22 billion overseas

With Apple CEO Tim Cook's visit to Capitol Hill today, the country's attention is once again on U.S. companies keeping cash in foreign subsidiaries to avoid taxes.

Charlotte-based companies are in on the action as well -- to the tune of $22 billion in earnings kept overseas, an Observer review of securities filings shows.

Of course, the vast majority of that comes from Bank of America, the state's largest company by far and one with a large international presence.

Bank of America has $17.2 billion of undistributed earnings in off-shore subsidiaries, according to its latest annual filing. If it were brought back to the U.S., the Charlotte bank would have to pay $4.3 billion in taxes on it, the company estimated.

The figure isn't unusual for one of the nation's largest banks. Citigroup, for instance, has $42.6 billion of earnings offshore -- more than even Apple, filings show.

JPMorgan Chase, the largest U.S. bank by assets, keeps $25.1 billion of undistributed earnings in foreign units. Goldman Sachs comes in at $21.7 billion. Wells Fargo, with a smaller international presence, had $1.3 billion overseas.

Despite lawmakers' anger over this type of activity, none of it appears to be improper. Cook told senators Tuesday that Apple is complying with an outmoded tax system that disadvantages American companies, according to The New York Times.

It is unclear how much actual cash the undistributed earnings amount to. Companies that keep earnings in foreign units earn it there and say the money is reinvested there. But the figure is important in the discussion of U.S. tax policy and how companies should be allowed to move capital.

Among the next 10 largest companies in Charlotte and the surrounding towns, Duke Energy has the most in off-shore earnings, at $2 billion.

The rest of the top 10, according to their most recent annual filings:

SPX: $1.9 billion
Carlisle Cos.: $300.5 million
Babcock & Wilcox Co.: $271.1 million
Nucor Corp.: $176.5 million
Lowe's: $36 million
Snyder's-Lance: $8.1 million
Family Dollar: None reported
Sonic Automotive: None reported
Coca-Cola Bottling Co.: None reported


Anonymous said...

Globalization, the answer to ALLLLLL our prayers. We'll be so much better off. Err...scratch that. We're getting ripped off.

Anonymous said...

Once again an Observer writer that is clueless. Most of these companies have operations overseas and have already paid taxes in those jurisdictions. Bringing the cash back to the US will subject them to double taxation.

Anonymous said...

Observer, this is Taxation 101. Do you want to pay more taxes than you have to? The U.S. government is not a charitable organization. If I had billions of dollars in offshore accounts, I would not lose any sleep over this. But Obama and his cronies want this country to fail.

Anonymous said...

I don't see any cluelessness. They just report some facts and figures. The real point is that while some news outlets and Apple haters seem to pretend that somehow Apple is the Lone Stranger in all this, it is really the norm for multi-national corporations.

Maybe the laws should be changed, but the businesses are taking advantage of the laws as they stand.

I have every confidence in the do-nothing Congress that they will hold hearings and get on TV and do nothing as usual other than some phony manufactured crises.

Anonymous said...

Welcome to the new "global economy" that we constantly hear about...as if it is a good thing for the average U.S. citizen. It is not. As economies "globalize" all that means is that other countries begin to look more like us economically...and us more like them. It is happening. Know any foreign countries that have two economic classes...the super rich and the everyone-else-is-poor? Yep. Lots of them out there. We are next. So why do we hear how great this "new global economy" is for the U.S. then? Because that message comes from corporations and their CEOs who benefit from the cheap labor...and shipping jobs overseas...and mergers, etc. Moving to a two class system is GREAT if you are positioned to be the super rich and get even richer. We had the leading economy. Globalize and integrate with others more...they rise and we go down. Fact. Look around you. It is EVERYWHERE in this country.