Toyota 2015 Annual Report Download - page 176

TOYOTA MOTOR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Toyota is subject to a number of different income taxes which, in the aggregate, indicate a statutory rate in
Japan of approximately 37.6%, 35.2% and 32.9% for the years ended March 31, 2014, 2015 and 2016,
respectively. The statutory tax rates in effect for the year in which the temporary differences are expected to
reverse are used to calculate the tax effects of temporary differences which are expected to reverse in the future
years. Reconciliation of the differences between the statutory tax rate and the effective income tax rate is as
follows:
For the years ended March 31,
2014 2015 2016
Statutory tax rate ............................................. 37.6% 35.2% 32.9%
Increase (reduction) in taxes resulting from:
Non-deductible expenses ................................... 2.2 1.5 0.3
Deferred tax liabilities on undistributed earnings of foreign
subsidiaries ........................................... 1.5 1.0 1.0
Deferred tax liabilities on undistributed earnings of affiliated
companies accounted for by the equity method ............... 3.0 2.5 2.4
Valuation allowance ...................................... (4.3) (0.5) (0.4)
Tax credits .............................................. (6.5) (5.3) (4.7)
The difference between the statutory tax rate in Japan and that of
foreign subsidiaries ..................................... (3.2) (2.4) (1.3)
Unrecognized tax benefits adjustments ........................ 0.0 3.2 0.2
Revision to reduce deferred tax assets and liabilities at the fiscal
year-end due to changes in tax rates ........................ 0.9 (1.9) (0.5)
Other .................................................. 0.3 (2.4) (0.5)
Effective income tax rate ....................................... 31.5% 30.9% 29.4%
“Unrecognized tax benefits adjustments” for the year ended March 31, 2015 reflects a charge for the
settlement of a pre 2012 tax position in a foreign jurisdiction.
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