Tuesday, 23 January, 2018

BP expects United States earnings uplift from tax reform

BP sets $1.5 bln charge for US tax changes but sees long-term boost BP takes $1.5 billion charge over US tax changes, joining Shell
Nellie Chapman | 02 January, 2018, 18:36

Estimate the exact impact is hard as it is "subject to a number of complex provisions in the legislation which BP is reviewing", the company said.

Shell "expects the potential economic impact of the recently enacted U.S. tax reform legislation to be favourable to Shell and to its United States operations, primarily due to the future reduction in the USA corporate income tax rate from 35% to 21%", the Anglo-Dutch supermajor said on December 27.

The British company's shares were down 1.15 percent by 1534 GMT. This press release contains certain forward-looking statements – that is, statements related to future, not past events – which may relate to one or more of the financial condition, results of operations and businesses of BP and certain of the plans and objectives of BP with respect to these items.

BP PLC is joining a host of companies whose earnings will be dented by the USA tax overhaul, saying Tuesday it would suffer a roughly $1.5 billion accounting charge in the fourth quarter because of the legislation.

- British energy company BP BP.L expects a positive impact on future post-tax earnings from the United States after the changes to US corporate taxes, it said on Tuesday.

"The ultimate impact of the change in the USA corporate income tax rate is subject to a number of complex provisions in the legislation which BP is reviewing", BP said in a statement. Companies can log such assets during unprofitable periods and use them as credits toward future tax payments.

Last week, Royal Dutch Shell PLC said the impact on its earnings will likely be a noncash hit of between $2 billion and $2.5 billion in the fourth quarter.

In oil and gas production, BP has ample operations in the Gulf of Mexico and onshore shale operations.