Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

An analysis of the provision for income taxes follows:



	Year Ended December 31
	2017			2016			2015
Current income taxes
United States	$	463		$	523		$	223
State	52			53			56
Other countries	330			361			394
Total	845			937			673
Deferred income taxes
United States	(68		)	(40		)	(180		)
State	(3		)	31			(74		)
Other countries	2			(6		)	(1		)
Total	(69		)	(15		)	(255		)
Total provision for income taxes	$	776		$	922		$	418

Income before income taxes is earned in the following tax jurisdictions:



	Year Ended December 31
	2017		2016		2015
United States	$	1,995	$	2,088	$	451
Other countries	996		921		884
Total income before income taxes	$	2,991	$	3,009	$	1,335

Deferred income tax assets and liabilities are composed of the following:



	December 31
	2017			2016
Deferred tax assets
Pension and other postretirement benefits	$	312		$	499
Tax credits and loss carryforwards	470			450
Derivatives and unrealized exchange gains and losses	63			32
Share based compensation	47			86
Other	308			480
	1,200			1,547
Valuation allowances	(176		)	(225		)
Total deferred tax assets	1,024			1,322

Deferred tax liabilities
Property, plant and equipment, net	818			1,079
Investments in subsidiaries	117			190
Goodwill	83			83
Other	186			268
Total deferred tax liabilities	1,204			1,620
Net deferred tax assets (liabilities)	$	(180	)	$	(298	)

Presented below is a reconciliation of the income tax provision computed at the U.S. federal statutory tax rate to the actual effective tax rate:



	Year Ended December 31
	2017		2016		2015
U.S. statutory rate applied to income before income taxes	35.0	%	35.0	%	35.0	%
Rate of state income taxes, net of federal tax benefit	1.1		1.8		(0.9	)
Statutory rates other than U.S. statutory rate	(3.1	)	(2.7	)	(6.9	)
Venezuela deconsolidation, balance sheet remeasurement and inflationary impacts	—		(0.1	)	4.5
Uncertain tax positions adjustment^(a)	—		—		3.7
Routine tax incentives	(2.7	)	(4.0	)	(7.4	)
Net tax (benefit) cost on foreign income	(0.7	)	0.1		5.1
Net impact of the Tax Act	(2.5	)	—		—
Other - net^(b)	(1.2	)	0.5		(1.8	)
Effective income tax rate	25.9	%	30.6	%	31.3	%


(a)	In 2015, we updated our assessment of uncertain tax positions for certain international operations and as a result we recorded an immaterial income tax charge of $49 related to prior years.


(b)	Other - net is composed of numerous items, none of which is greater than 1.75 percent of income before income taxes.

Presented below is a reconciliation of the beginning and ending amounts of unrecognized income tax benefits:



	2017			2016			2015
Balance at January 1	$	321		$	406		$	416
Gross increases for tax positions of prior years	50			20			80
Gross decreases for tax positions of prior years	(23		)	(104		)	(61		)
Gross increases for tax positions of the current year	37			39			59
Settlements	(19		)	(29		)	(63		)
Other	(12		)	(11		)	(25		)
Balance at December 31	$	354		$	321		$	406

As of December 31, 2017, the following tax years remain subject to examination for the major jurisdictions where we conduct business: