What was the tax charge (credit) on profit or loss for Petro Stopping Center in 2023?
Petro_Stopping_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2024 | 2023 | 2022 | |
|---|---|---|---|
| Profit (loss) before taxation | 4,044 | 6,087 | 15,030 |
| Tax charge (credit) on profit or loss | 773 | 1,128 | 4,589 |
| Effective tax rate | 19 % | 19 % % of profit before taxation | 31 % |
| US statutory corporation tax rate | 21 | 21 | 21 |
| Increase (decrease) resulting from | |||
| Taxes on foreign operations at other than 21% | — | (7) | 9 |
| State income taxes, net of Federal income tax offset | 1 | 3 | 1 |
| Items not deductible for tax purposes | 1 | 2 | 1 |
| Adjustments in respect of prior years | 2 | (2) | — |
| Share based compensation | — | (1) | — |
| Non-controlling interest | (1) | — | — |
| Valuation allowance | (6) | 3 | (1) |
| Other | 1 | — | — |
| Effective tax rate | 19 | 19 | 31 |
Source: Item 23 — RECEIPTS **RECEIPTS (FDD pages 87–131)
What This Means (2025 FDD)
According to Petro Stopping Center's 2025 Franchise Disclosure Document, the tax charge on profit or loss for 2023 was $1,128 million. This figure is part of a reconciliation of the effective tax rate, which also shows a profit before taxation of $6,087 million for the same year. The effective tax rate for Petro Stopping Center in 2023 was 19% of profit before taxation, while the US statutory corporation tax rate was 21%.
The reconciliation further breaks down the differences between the US statutory rate and the effective tax rate. Some factors contributing to these differences include taxes on foreign operations (a decrease of $7 million), state income taxes (an increase of $3 million), items not deductible for tax purposes (an increase of $2 million), and adjustments in respect of prior years (a decrease of $2 million). Share-based compensation also contributed to a decrease of $1 million, while valuation allowance resulted in an increase of $3 million.
Prospective franchisees should understand how these tax figures and rates impact Petro Stopping Center's overall profitability. The tax charge represents a significant expense, and the effective tax rate reflects the actual tax burden on the company's profits. Understanding the components that contribute to the difference between the statutory and effective tax rates can provide insights into the tax planning strategies and financial management of Petro Stopping Center.