What was the consolidated effective tax rate for Dq Treat in 2022?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| U.S. federal statutory rate | 21.00 % | 21.00 % | 21.00 % |
| State income tax—net of federal effect | 2.77 | 2.90 | 2.86 |
| Foreign income tax | 0.58 | 0.82 | 0.88 |
| Other—net | (0.14) | (0.52) | (0.54) |
| Consolidated effective tax rate | 24.21 % | 24.20 % | 24.20 % |
Source: Item 17 — The following paragraph is added to the end of Item 17 of the Disclosure Document: (FDD pages 70–378)
What This Means (2025 FDD)
According to Dq Treat's 2025 Franchise Disclosure Document, the consolidated effective tax rate for the year 2022 was 24.20%. This rate reflects the company's overall tax burden considering various factors beyond just the U.S. federal statutory rate. The FDD provides a breakdown of how this consolidated rate is derived.
The calculation includes the U.S. federal statutory rate, which was 21.00% for 2022. Additional components factored into the consolidated rate are state income tax (net of federal effect) at 2.86%, foreign income tax at 0.88%, and other net adjustments at (0.54)%. These individual components are combined to arrive at the final consolidated effective tax rate.
For a prospective franchisee, understanding the effective tax rate is crucial as it provides insight into the overall profitability and financial health of Dq Treat. While franchisees do not directly pay this corporate tax rate, it reflects the financial management and tax strategies of the parent company, which can indirectly affect the support and resources available to franchisees. A stable and well-managed tax strategy at the corporate level can contribute to the long-term stability and success of the franchise system.