Boeing to Incur $ 150 million Expenditure Owing to Health Reform
The world's second- largest commercial-plane manufacturing company Boeing Co. is planning to take a charge of $150 million in the first quarter of this year. This charge has come into effect owing to the impact of the U. S. health care reform law on the company.
The company states that by 2013, the company will be unable to claim deduction from income tax owing to certain prescription drug benefits that have been given to retirees. Accounting norms necessitate that the company should take the charge till the legislation is enacted.
According to the Boeing based in Chicago, this income tax expenditure will diminish profit by 20 cents a share. This expense hadn't been included in the company's projection which was issued on January 27.
The $1 trillion health-care reform bill was passed by the senate and has been turned into a law. Owing to this reform companies like Caterpillar Inc. and AT&T Inc. were prompted to divulge charges related to the tax on retiree drug-benefit subsidy.
It is estimated that health-care costs may reduce as much as $14 billion from U. S. corporate profits.