German automaker Daimler stated on Friday the U.S. tax reform would lead to an income tax benefit of around 1.7 billion euros ($2.01 billion) in its 2017 results.
Other problems not linked to the U.S. tax reform will result in greater taxes, however, which means the total boost in net income will pertain to around 1 billion euros, the company stated, without giving information of those other problems.
U.S. President Donald Trump approved a $1.5 trillion tax overhaul on Friday, which cuts the corporate rate from 35 percent to 21 percent.
“Due to the broadly based U.S. commercial and financial services business, combined with a material value added, Daimler – much like many other local U.S. business – gain from the chosen tax reform,” Daimler stated.
The lower tax rate needs the revaluation of net deferred tax liabilities at Daimler’s U.S. subsidiaries, which the group stated surpass its deferred tax assets.
It said it was still analyzing the potential effect of other steps in the tax law.
The tax benefit will not impact its commercial free cash flow or operating revenue for this year, it stated.
