Viewing a single comment thread. View all comments

innocentlookingstew t1_izzr08n wrote

Anyone has a good idea or explanation why provision for tax is only 4%? I would assume the business to get taxed higher. Or is it included in one of the categories already, and if so, what are these 4% provisions?

2

[deleted] t1_izzw13t wrote

It’s hard to tell since their quarterly filings don’t provide reconciliations, but combining that info with their 2021 total filing, here’s my best explanation as a CPA:

  1. Pfizer sells into a lot of foreign countries with different tax rates than the US. On their 2021 tax rec, this was the single largest driver of their low tax rate

  2. They’ve received a lot of tax credits from their vaccine distribution both in 2021 and 2022

  3. They had IRS resolutions in 2022 that reduced their tax expense in prior years, which reduces this years income tax expense

  4. The actual tax they paid was much higher than the $356 million reported here. It’s just that income tax expense includes deferred taxes for future years, which are very negative right now. For reference, they’ve paid almost $5 billion of tax for 2022 so far

1