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INCOME TAXES:
 6 Months Ended
Jun. 30, 2013
INCOME TAXES:  
INCOME TAXES:

NOTE 4 — INCOME TAXES:

 

The income tax provision and the effective income tax rate for the first six months of 2013 and 2012 were as follows ($ in millions):

 

 

 

2013

 

2012

 

Income tax provision

 

$

401.8

 

$

628.7

 

Effective income tax rate

 

31.9

%

35.1

%

 

These provisions include income taxes for Peru, Mexico and the United States. The decrease in the effective tax rate in the first six months of 2013 from the tax rate in the 2012 period was principally caused by a reduction in forecasted dividends from the Company’s Mexican subsidiaries in 2013 when compared to the same period in 2012.

 

Special Mining Tax:  In September 2011, the Peruvian government enacted a tax for the mining industry.  This tax is based on operating income and its rate ranges from 2% to 8.4%. It begins at 2% for operating income margin up to 10% and increases by 0.4% of operating income for each additional 5% of operating income until 85% of operating income is reached.  The Company has accrued $21.1 million and $28.4 million of special mining tax as part of the income tax provision for the first six months of 2013 and 2012, respectively.