Barclays has said Donald trump’s us tax changes would reduce its profits by about 1 billion pounds.
The bank said the law, which was signed into law last week, would make it difficult to deduct past losses from future tax bills.
Barclays said the change had reduced the value of its “deferred tax assets” and led to a one-off after-tax income of about 1 billion pounds.
Barclays’ full-year earnings are expected to fall further. The bank lost 628 million pounds in the first nine months of this year because of the cancellation of African businesses.
Despite the short-term shock, the bank said it expected tax changes and the us corporate tax rate would fall to 21 per cent from 35 per cent on January 1, with a “positive impact” on its future earnings.
Shell also welcomed the tax changes, but said its profit would hit $2.5 billion to $2.5 billion ($1.5 billion to 1.9 billion pounds) this year, as it takes into account the impact on deferred tax assets.
The company said, “royal Dutch shell is expected, recently issued us tax reform legislation could have a potential impact on economic help the shell and its business in the United States, mainly due to the American company income tax rate cut in the future.
Companies around the world will be forced to take similar action. In the u.s., bank of America, citigroup inc., aig and mortgage providers fannie mae and Freddie MAC are expected to write down nearly $50 billion. Ubs said it expected sfr3 billion (2.3 billion pounds) of Swiss francs (2.3 billion pounds) and Credit Suisse expects tax changes to cut its earnings by sfr2.3 billion.
Mr Trump said the biggest reform of the us tax system since the 1980s would be “great for the economy”.
“Businesses are going crazy in this area, and I think it’s even more than I expected,” he said.
But opponents say The changes are a gift to The wealthy, and The Center for American Progress, a think-tank in Washington, dc, has found that he will save as much as $15 a year.
Last week, the President insisted that a typical family of four would benefit, saying “the Numbers speak,” adding that the bill was “bad” for him personally.