Engineering group Weir expects the recently enacted Tax Cuts and Jobs Act, which came into effect in the US on 1 January, will give rise to an initial one-off non-cash tax credit in 2017. This will resulting from the revaluation of the group's aggregate US Deferred Tax Assets and Deferred Tax Liabilities following the reduction in the US federal rate of corporate income tax. Going forward, from 2018 the favourable impact of the headline federal rate reduction is likely to be largely offset by greater restriction on the level of interest deduction allowed in the US, leaving the overall impact of the Act on the group's effective tax rate broadly neutral. Based on this preliminary assessment, the group's effective tax rate for 2018 is likely to be around 25%.
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