Burford Capital Limited provided an update on June 30, 2025, regarding the proposed tax provisions on litigation finance within the US Senate's budget reconciliation bill. Revisions to the bill over the weekend included a reduction in the proposed tax rate to 31.8% from the initial 40.8%.
Additionally, the withholding tax rate was reduced to 15.9% of gains, down from 50% of the tax rate applied to gross proceeds. In response to these changes, the nonpartisan Joint Committee on Taxation lowered its estimates for expected tax revenue from these provisions to $1.4 billion over the next decade, a decrease from prior estimates as high as $3.5 billion.
The Senate continues to debate the legislation, and the outcome, including the possibility of the provisions not being enacted at all, remains unpredictable. Burford noted it is still unable to fully assess the impact of these provisions, if enacted, on its future tax position.
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