A very insightful quote from my colleague Al Liguori regarding how the GILTI tax is creating unexpected increases in taxes for some U.S. companies. Companies with international operations - even those that are not technology and pharmaceutical firms - must pay very close attention to how the GILTI tax can unexpectedly increase their effective tax rates. Furthermore, it is imperative that the GILTI tax is appropriately accounted for in a valuation of the company, or there is a risk that the business will be overvalued due to an understated tax rate.
A new tax aimed at overseas income earned by U.S. technology and pharmaceutical firms is hitting unexpected places, including Kansas City Southern , a U.S. railroad company. The new minimum tax on foreign earnings will cost Kansas City Southern $25 million a year, according to the company, which warns the measure also encourages it to borrow money outside the U.S.
https://www.wsj.com/articles/new-tax-on-overseas-earnings-hits-unintended-targets-1522056600
