Starbucks 2012 Annual Report Download - page 87

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81
Reconciliation of the statutory US federal income tax rate with our effective income tax rate:
Fiscal Year Ended Sep 30, 2012 Oct 2, 2011 Oct 3, 2010
Statutory rate 35.0% 35.0% 35.0%
State income taxes, net of federal income tax benefit 2.5% 2.5% 2.5%
Benefits and taxes related to foreign operations (3.3)% (3.1)% (2.5)%
Domestic production activity deduction (0.7)% (0.8)% (0.9)%
Other, net(1) (0.7)% (2.5)% (0.1)%
Effective tax rate 32.8% 31.1% 34.0%
(1) Fiscal 2011 includes a benefit of 0.9% related to the acquisition of the remaining ownership interest in
Switzerland and Austria.
US income and foreign withholding taxes have not been provided on approximately $1.5 billion of cumulative
undistributed earnings of foreign subsidiaries and equity investees. We intend to reinvest these earnings for the
foreseeable future. If these amounts were distributed to the US, in the form of dividends or otherwise, we would
be subject to additional US income taxes, which could be material. Determination of the amount of unrecognized
deferred income tax liabilities on these earnings is not practicable because of the complexities with its
hypothetical calculation, and the amount of liability, if any, is dependent on circumstances existing if and when
remittance occurs.