Goldman Sachs anticipates $5 billion decrease in quarterly earnings from tax bill

Goldman Sachs said Friday that it anticipates its earnings will decrease by about $5 billion in the fourth quarter as a result of the Republican tax overhaul signed into law last week.

Reuters reported that the financial giant said that the drop in earnings is mostly due to repatriation tax, though the actual amount may differ from the initial estimate.

The announcement came a week after President Trump signed a sweeping GOP rewrite of the nation’s tax code that, among other things, slashes the corporate tax rate from 35 percent to 21 percent.

The new tax plan imposes a one-time 15.5 percent tax on cash assets currently held overseas and a 8 percent tax for illiquid assets. Under the old tax code, corporations’ foreign earnings were subject to a 35-percent tax rate, but businesses only had to pay it when the money was repatriated.

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That cut allows U.S. businesses to repatriate cash kept abroad without taking a major tax hit.

Another company, pharmaceutical giant Amgen Inc., said last week that it would also see a tax bill of $6 billion to $6.5 billion as it works to repatriate money and other assets held abroad.

It is not clear how much Amgen is planning to transfer to the U.S.