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The Impact of US Tax Reform on Corporate Strategy and M&A

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The Impact of US Tax Reform on Corporate Strategy and M&A

Boston Consulting Group,

5 min read
5 take-aways
Audio & text

What's inside?

US corporate tax reform could bring a jackpot of opportunities to M&A.

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Editorial Rating

8

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Recommendation

For the first time since the 1980s, the United States overhauled its tax structure in 2017, with Congress slashing the top corporate tax rate to 21% from 35% and making additional reforms to improve US investment. In this brief but substantive report, Boston Consulting Group professionals dissect pieces of the tax legislation and assess their effects on corporate behavior, particularly in M&A, asset positioning and value creation. getAbstract recommends this expert study to executives and investors who want to understand more thoroughly the ramifications of US tax reform.

Summary

Corporate executives found plenty to applaud in the US tax reform of 2017. With limited changes to the individual tax code, the legislation largely centered on business tax and investment incentive redesign. One headline was a reduction in the top corporate rate to 21% from 35%; another focused on the potential repatriation of between $1.5 and $2 trillion of cash held overseas, subject to a single 15.5% tax charge. Other significant changes include the “immediate expensing” of capital expenditures and constraints on interest deductions.  

The reduction in the ...

About the Authors

Eric Wick et al. are professionals with the Boston Consulting Group.

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