inflation effects on capital budgeting

Inflation reduces the tax savings from depreciation. If inflation is higher than expected, the firm’s real taxes are effectively increased because the depreciation tax shelter is less valuable. Here, how dose the depreciation tax shelter work? how it is less valuable after inflation? dose inflation affect actual dollar amount of depreciation tax shelter? Thanks.

depreciation is deductible creating tax savings. because of inflation depreciation is less than supposed to, reducing the tax savings