Citi’s Manthey Sees Low Risk to European Stocks From US Tax Bill

Any hit from the so-called US “revenge” tax on European stocks should be relatively small, according to Citigroup strategists.

• NOTE: The tax, titled Section 899, in President Donald Trump’s fiscal package would increase rates for individuals and companies from countries whose tax policies the US deems “discriminatory”
  • Senate Republicans will examine the potential impact of the levy before passing the measure, Majority Leader John Thune said Monday
• Citi strategists led by Beata Manthey say that an incremental 5% tax on US profits would decrease Stoxx 600 earnings by ~0.5%
  • “The company-level impact of penalty taxes should be relatively concentrated ...