Apple, Microsoft, Amazon, Facebook, Intel, and Alphabet had a combined $100B+ in overseas pretax income in FY 2020, making them targets of Biden's new tax plans
Bloomberg : Tweets: @ron_miller and @alistairmbarr Tweets: Ron Miller / @ron_miller : By jove I think they've got it. https://twitter.com/... Alistair Barr / @alistairmbarr : The biggest loser from Biden's tax proposal? Big Tech and all that IP shifting around the globe via @jackiedavalos1 @technology https://www.bloomberg.com/...
Context & Ripple Effects
The Biden administration signaled in February that it was open to a deal on taxing US tech companies globally through the OECD, and this report identifies who would pay: six firms with a combined $100B+ in overseas pretax income in FY2020. The scrutiny is not new — a Fair Tax Mark study found the same group avoided $100B+ in taxes over a decade, giving the White House a public record to legislate against.
What makes this moment different from the last round is direction: the 2017 tax reform cut the cost of holding profits abroad, after which only Apple among the top five announced major changes to its cash allocation while the group's $115B+ post-reform buyback spree showed where repatriated cash went. Biden's plan reverses the incentive structure.
First-order effects
- Apple, Microsoft, Amazon, Facebook, Intel, and Alphabet face a direct hit to earnings models built on booking IP-driven profits in low-tax jurisdictions — the $100B+ overseas pretax pool is exactly what Biden's proposals are calibrated to reach.
- The named companies' treasury operations must reprice foreign cash holdings that were parked under the post-2017 regime, reversing the assumptions behind Apple's earlier allocation shift and its peers' inaction.
Second-order effects
- Buyback capacity comes under pressure: if overseas income gets taxed at materially higher rates, the post-reform pattern of near-doubled repurchase spending ($115B+ in three quarters across the group) becomes harder to sustain at scale.
- The OECD timeline gives the companies a negotiating window — expect intense lobbying for carve-outs and treaty terms before any multilateral agreement locks in rates they can't arbitrage away.
Third-order effects
- If the OECD framework lands as planned by summer, the decade-long playbook documented by the Fair Tax Mark — shifting IP royalties to low-tax subsidiaries — structurally loses its value, forcing Big Tech toward tax positions closer to domestic book income.
- Success would set a template other revenue-rich, mobile-profit industries get measured against, making corporate tax competition between the US and Europe a managed process rather than the EU-Trump clash it was.
The trend: Global tax coordination is converging on Big Tech's overseas profit structures, turning IP-shifting from a competitive advantage into a legislative target.