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Income Taxes
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes

12.  Income Taxes

Income (loss) before taxes subject to United States and non-United States income taxes was as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

United States

$

30

 

 

$

(4,394

)

 

$

(8,991

)

Outside United States

 

2,344

 

 

 

(6,904

)

 

 

(1,427

)

 

$

2,374

 

 

$

(11,298

)

 

$

(10,418

)

 

Schlumberger recorded net pretax credits of $65 million in 2021 ($75 million of credits in the US and $10 million of charges outside the US). Schlumberger recorded net pretax charges of $12.515 billion in 2020 ($3.961 billion in the US and $8.554 billion outside the US); and $12.901 billion in 2019 ($8.769 billion in the US and $4.132 billion outside the US). These charges and credits are included in the table above and are more fully described in Note 3 – Charges and Credits.

The components of net deferred tax assets (liabilities) were as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

Intangible assets

$

(855

)

 

$

(881

)

Net operating losses

 

427

 

 

 

421

 

Research and development credits

 

118

 

 

 

96

 

Fixed assets, net

 

151

 

 

 

151

 

Inventories

 

58

 

 

 

59

 

Investments in non-US subsidiaries

 

(161

)

 

 

(171

)

Pension and other postretirement benefits

 

(136

)

 

 

(31

)

Other, net

 

304

 

 

 

337

 

 

$

(94

)

 

$

(19

)

 

The deferred tax balances at December 31, 2021 and 2020 were net of valuation allowances relating to net operating losses in certain countries of $133 million and $127 million, respectively.  Additionally, the deferred tax balances were net of valuation allowances relating to the following:

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

Foreign tax credits

$

210

 

 

$

106

 

Capital losses

$

49

 

 

$

54

 

 

Approximately $390 million of the $427 million deferred tax asset relating to net operating losses at December 31, 2021 can be carried forward indefinitely.  The vast majority of the remaining balance expires at various dates between 2030 and 2040.

The components of Tax expense (benefit) were as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

Current:

 

 

 

 

 

 

 

 

 

 

 

United States-Federal

$

(32

)

 

$

21

 

 

$

(81

)

United States-State

 

-

 

 

 

5

 

 

 

11

 

Outside United States

 

509

 

 

 

410

 

 

 

770

 

 

 

477

 

 

 

436

 

 

 

700

 

Deferred:

 

 

 

 

 

 

 

 

 

 

 

United States-Federal

$

(132

)

 

$

(824

)

 

$

(660

)

United States-State

 

12

 

 

 

(67

)

 

 

(93

)

Outside United States

 

(15

)

 

 

(563

)

 

 

(257

)

Valuation allowance

 

104

 

 

 

206

 

 

 

(1

)

 

 

(31

)

 

 

(1,248

)

 

 

(1,011

)

 

$

446

 

 

$

(812

)

 

$

(311

)

 

A reconciliation of the United States statutory federal tax rate to the consolidated effective tax rate follows:

 

 

2021

 

 

2020

 

 

2019

 

US federal statutory rate

 

21

%

 

 

21

%

 

 

21

%

Charges and credits (See Note 3)

 

-

 

 

 

(14

)

 

 

(19

)

Other

 

(2

)

 

 

-

 

 

 

1

 

 

 

19

%

 

 

7

%

 

 

3

%

 

A number of the jurisdictions in which Schlumberger operates have tax laws that are not fully defined and are evolving. Schlumberger’s tax filings are subject to regular audit by the tax authorities. These audits may result in assessments for additional taxes that are resolved with the tax authorities or, potentially, through the courts.  Tax liabilities are recorded based on estimates of

additional taxes that will be due upon the conclusion of these audits.  Due to the uncertain and complex application of tax regulations, the ultimate resolution of audits may result in liabilities which could be materially different from these estimates.

A reconciliation of the beginning and ending amount of liabilities associated with uncertain tax positions for the years ended December 31, 2021, 2020 and 2019 is as follows:

 

(Stated in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

2019

 

Balance at beginning of year

$

1,271

 

 

$

1,301

 

 

$

1,433

 

Additions based on tax positions related to the current year

 

38

 

 

 

76

 

 

 

86

 

Additions for tax positions of prior years

 

19

 

 

 

78

 

 

 

65

 

Impact of changes in exchange rates

 

(24

)

 

 

(3

)

 

 

2

 

Settlements with tax authorities

 

(49

)

 

 

(15

)

 

 

(50

)

Reductions for tax positions of prior years

 

(228

)

 

 

(87

)

 

 

(176

)

Reductions due to the lapse of the applicable statute of limitations

 

(26

)

 

 

(79

)

 

 

(59

)

 

$

1,001

 

 

$

1,271

 

 

$

1,301

 

 

The amounts above exclude accrued interest and penalties of $164 million, $184 million and $188 million at December 31, 2021, 2020 and 2019, respectively.  Schlumberger classifies interest and penalties relating to uncertain tax positions within Tax expense (benefit) in the Consolidated Statement of Income (Loss).

    

The following table summarizes the tax years that are either currently under audit or remain open and subject to examination by the tax authorities in the most significant jurisdictions in which Schlumberger operates:

 

Canada

2014 - 2021

Ecuador

2017 - 2021

Mexico

2013 - 2021

Norway

2016 - 2021

Russia

2016 - 2021

Saudi Arabia

2016 - 2021

United Kingdom

2017 - 2021

United States

2017 - 2021