Sony 2000 Annual Report Download - page 86

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84
SONY CORPORATION ANNUAL REPORT 2000
Yen in millions Dollars in millions
Year ended March 31 Year ended
1998 1999 2000 March 31, 2000
Income before income taxes:
Sony Corporation and subsidiaries in Japan . . . . . . . . . ¥298,657 ¥203,944 ¥ 70,892 $ 669
Foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 160,606 173,747 1 93,41 8 1 ,824
¥459,263 ¥377,691 ¥264,310 $2,493
Income taxes—Current:
Sony Corporation and subsidiaries in Japan . . . . . . . . . ¥145,890 ¥ 85,970 ¥ 59,239 $ 559
Foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,223 72,416 61,564 580
¥210,113 ¥158,386 ¥120,803 $1 ,1 39
Income taxes—Deferred:
Sony Corporation and subsidiaries in Japan . . . . . . . . . ¥ 7,221 ¥ 16,433 ¥(1 7,977) $ (1 70)
Foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,466) 2,154 (8,1 82) (77)
¥ 4,755 ¥ 18,587 ¥(26,1 59) $ (247)
Year ended March 31
1998 1999 2000
Statutory tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51.0% 48.0% 42.0%
Increase (reduction) in taxes resulting from:
Income tax credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2.4) (1.3) (1 .3)
Valuation allowance recognized on current losses of subsidiaries . . . . . . . 1.9 5.4 2.8
Decrease in deferred tax liabilities on undistributed earnings of
foreign subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2.7) (2.8) (5.6)
Changes in Japanese income tax rates . . . . . . . . . . . . . . . . . . . . . . . . . . (0.8) (3.5) —
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (0.2) 1.1 (2.1 )
Effective income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46.8% 46.9% 35.8%
Income before income taxes and income tax expense
comprise the following:
16. Income taxes
Sony is subject to a number of different income taxes.
Due to changes in Japanese income tax regulations, the
statutory rate was reduced from 51% to 48% effective
April 1, 1998 and was further reduced from 48% to 42%
effective April 1, 1999. The respective newly enacted
rates were used in calculating the future expected tax
effects of temporary differences as of March 31, 1998
and 1999. The effect of the change in the tax rate on
the balance of deferred tax assets and liabilities was
insignificant as of March 31, 1998 and reduced the net
deferred tax liability and income tax expense by
approximately ¥13,400 million as of March 31, 1999.
Reconciliation of the differences between the statutory
tax rate and the effective income tax rate is as follows: