APA · 10-Q · 2026Q3 · Full report

Income Tax Rate Changes

APA Corp · 2026-11-05 · Importance 45 · Surprise 50 · In source text

The U.K.’s Finance Act 2025, enacted on March 20, 2025, increased the Energy (Oil and Gas) Profits Levy rate from 35% to 38%, effective November 1, 2024 through March 31, 2030. The U.S. enacted the One Big Beautiful Bill Act of 2025 on July 4, 2025, making 100% bonus depreciation permanent for eligible assets acquired and placed in service after January 19, 2025. It also aligned intangible drilling cost treatment for corporate alternative minimum tax purposes with regular tax treatment starting in 2026; APA does not expect the law to materially affect total 2026 tax expense because current and deferred tax effects offset.

Key facts

• The U.K. Energy (Oil and Gas) Profits Levy rate increased from 35% to 38%, effective November 1, 2024 through March 31, 2030, under Finance Act 2025 enacted March 20, 2025. source
• The One Big Beautiful Bill Act of 2025 made 100% bonus depreciation permanent for eligible assets acquired and placed in service after January 19, 2025. source
• The U.K. Energy Profits Levy increased from 35 percent to 38 percent under Finance Act 2025, effective November 1, 2024, through March 31, 2030. source
• APA does not expect the One Big Beautiful Bill Act of 2025 to have a material impact on total tax expense for the year ended December 31, 2026, because current tax expense impacts are offset by deferred tax expense impacts. source
• APA does not expect the 2025 U.S. One Big Beautiful Bill Act to materially affect total 2026 tax expense because current-tax impacts are offset by deferred-tax impacts. source
• APA’s effective income tax rate for the nine months ended September 30, 2026 differed from the 21% U.S. federal statutory rate due to taxes on foreign operations. source
• APA’s effective tax rate for the first nine months of 2026 differed from the 21 percent U.S. federal statutory rate due to taxes on foreign operations. source

Impact estimates