A revamp of the American tax system by president Donald Trump could benefit Kiwi companies like Mainfreight that do business in the United States.
The nine-page proposal to overhaul the tax system includes tax cuts for corporations and small businesses, which would drop the corporate income tax rate to 20% from its current level of 35%, BusinessDesk reports.
However, Mainfreight chief financial officer Tim Williams told BusinessDesk he doesn’t expect changes to come into force anytime soon.
“It is a benefit to us if it does occur…but until it gets passed in legislation you can’t count on it because it has a lot of hurdles to get over in the meantime.”
On the face of it, the cut could save the company between $2 million and $3 million a year, BusinessDesk reports.
However, KPMG tax partner John Cantin agrees it’s hard to know what the final package will look like.
“There are no guarantees about any legislation changes in the US. This is certainly high-level and very much subject to implementation.”
