Large oil firms, including BP and Shell are expected to benefit from changes made to the U.S tax code.
On Tuesday, BP stated it expects a positive outcome from the recent changes in the U.S. tax law on its future post-tax earnings.
In December 2017, the U.S. House of Representatives created history when it overhauled the U.S. tax law, a first since 3 decades, and cut corporate tax rates to 21% from 35%.
According to BP, the impact of the lowering of this tax rate would require BP to revaluate its U.S. deferred tax assets as well as liabilities; it also expects a one time tax levy of $1.5 billion.
BP stated it was in the process of reviewing the final impact of these recent tax changes and it expects to disclose the final one-time tax charge in its fourth-quarter results, due on February 6.
On a similar vein, last week, Shell disclosed that it expects the overhaul of U.S. tax code to have a “favorable” impact on its operations; the changes however would impact its fourth quarter results.