Imperial Brands sees little impact from US tax changes

Imperial Brands said on Thursday that it does not expect changes to the US tax system to materially impact its adjusted effective tax rate as it already benefits from "substantial" US tax amortisation of goodwill and intangibles, which contributes to a relatively low adjusted effective tax rate.

For the year to 30 September 2018, the tobacco company expects the reduced taxation of US earnings to result in a benefit of less than 1% to the adjusted effective tax rate. It continues to expect an overall adjusted effective rate of around 20%.

Imperial said its US deferred tax assets and liabilities will be revalued to take account of the corporate tax rate changes. This should give rise to a one-off credit of around £20m which will be treated as an adjusting item in the current year and will therefore not impact adjusted earnings.

The US tax reforms that kicked in this month will see corporate tax cut to 21% from 35%.

At 1355 GMT, the shares were down 2.6% to 2,993.50p.