Philips 2010 Annual Report Download - page 163

13 Group financial statements 13.11 - 13.11
Annual Report 2010 163
A reconciliation of the weighted average statutory income tax rate to
the effective income tax rate is as follows:
in %
2008 2009 2010
Weighted average statutory income tax
rate (18.5) 17.4 26.7
Tax rate effect of:
Changes related to:
- utilization of previously reserved loss
carryforwards (14.5) (0.3) (0.5)
- new loss carryforwards not expected
to be realized 69.3 13.3 2.8
- addition (releases) 1.6 (0.4) 0.3
Non-tax-deductible impairment charges 283.1 3.1 −
Non-taxable income (315.0) (25.9) (7.6)
Non-tax-deductible expenses 91.9 26.3 3.9
Withholding and other taxes (5.1) 4.7 1.2
Tax rate changes 1.0 (0.1) 0.2
Tax expenses due to other liabilities 37.2 8.3 (0.4)
Tax incentives and other 49.2 (24.1) (0.4)
Effective tax rate 180.2 22.3 26.2
The weighted average statutory income tax rate increased in 2010
compared to 2009, as a consequence of a change in the country mix of
income tax rates, as well as a change of the mix of profits and losses in
the various countries.
The effective income tax rate is lower than the weighted average
statutory income tax rate in 2010, attributable to non-taxable gains on
the sale of securities and other non-taxable income, and incidental tax
benefits, which were partly offset by non-tax-deductible costs, new
losses carried forward not expected to be realized, and income tax
expenses due to tax provisions for uncertain tax positions.