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Taxes Based on Income | 6 Months Ended
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Jun. 29, 2024
Income Tax Disclosure [Abstract] |
Taxes Based on Income | Taxes Based on Income The following table summarizes our income before taxes, provision for income taxes, and effective tax rate:
| Three Months Ended |  | Six Months Ended
(Dollars in millions) | June 29, 2024 |  | July 1, 2023 |  | June 29, 2024 |  | July 1, 2023
Income before taxes | $ | 238.4 |  |  | $ | 140.2 |  |  | $ | 472.8 |  |  | $ | 308.5 |
Provision for income taxes | 61.6 |  |  | 39.8 |  |  | 123.6 |  |  | 86.9 |
Effective tax rate | 25.8 | % |  | 28.4 | % |  | 26.1 | % |  | 28.2 | %
Our provision for income taxes for the three and six months ended June 29, 2024 included a net tax charge related to the tax on global intangible low-taxed income (“GILTI”) of our foreign subsidiaries and the recognition of foreign withholding taxes on current year earnings, partially offset by the benefit from foreign-derived intangible income (“FDII”). Our provision for income taxes for these periods was favorably affected by (i) higher tax incentives in certain foreign jurisdictions and the tax impacts resulting from Blue Chip Swap transactions in Argentina and (ii) discrete tax benefits from decreases in certain tax reserves, including interest and penalties, as a result of closing tax years. Our provision for income taxes for the three and six months ended July 1, 2023 included a net tax charge related to the tax on GILTI of our foreign subsidiaries and the recognition of foreign withholding taxes on current year earnings, partially offset by the benefit from FDII. Our provision for income taxes for these periods (i) was adversely affected by higher non-deductible expenses primarily resulting from foreign currency and interest rate fluctuations, as well as lower tax incentives in certain foreign jurisdictions, and (ii) included discrete tax benefits from decreases in certain tax reserves as a result of favorable court rulings in a foreign jurisdiction. The amount of income taxes we pay is subject to ongoing audits by taxing jurisdictions around the world. Our estimate of the potential outcome of any uncertain tax issue is subject to our assessment of the relevant risks, facts and circumstances existing at the time. We believe that we have adequately provided for reasonably foreseeable outcomes related to these matters. However, our future results may include favorable or unfavorable adjustments to our estimated tax liabilities in the period the assessments are made or resolved, which may impact our effective tax rate. The final determination of tax audits and any related legal proceedings could materially differ from the amounts currently reflected in our tax provision for income taxes and the related liabilities. We and our U.S. subsidiaries have completed the Internal Revenue Service Compliance Assurance Process through 2021. With limited exceptions, we are no longer subject to income tax examinations by tax authorities for years prior to 2010. It is reasonably possible that, during the next 12 months, we may realize a net decrease in our uncertain tax positions, including interest and penalties, of approximately $6 million, primarily as a result of closing tax years.

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