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News » UK » Trump hands Balfour £20m for starters » published 18 Jan 2018

Trump hands Balfour £20m for starters

Balfour Beatty’s 2017 profits are set to be boosted by an additional £20m from Donald Trump.

Donald Trump Above: Donald Trump

That’s what the US president’s cut in business tax is worth to the UK-based construction giant’s bottom line. And there is more to come.

The US government recently passed the Tax Cuts & Jobs Act which contains significant tax reform measures. Although the reforms are subject to further guidance and interpretations from the US Authorities, Balfour Beatty has been looking at the implications of the changes.

The reduction in US Federal corporate income tax rates from 35% to 21% will lead to a reduction in the effective tax rate on US earnings from c.40% to c.26% in 2018 and beyond.

Furthermore, as a result of this reduced tax rate on US assets the directors’ valuation of Balfour Beatty Investments portfolio will increase by approximately £95m.

In addition to this, the company expects 2017 earnings to benefit from a one-off non-cash credit from the revaluation of US deferred tax liabilities, expected to be approximately £20m.

 

 

MPU

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This article was published on 18 Jan 2018 (last updated on 18 Jan 2018).

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