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Income tax and deferred taxes | 12 Months Ended
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Dec. 31, 2018
Disclosure of income tax [Abstract] |
Disclosure of income tax [text block] |
| Note 30 | Income tax and deferred taxes
Accounts receivable from taxes as of December 31, 2018 and December 31, 2017, are as follows:
| 30.1 | Current and non-current tax assets
| a) | Current tax assets
|  | 12/31/2018 |  |  | 12/31/2017 |
|  | ThUS$ |  |  | ThUS$ |
Monthly provisional income tax payments, Chilean companies |  |  | 21,172 |  |  |  | 2,802 |
Monthly provisional income tax payments, foreign companies |  |  | 5,199 |  |  |  | 808 |
Corporate tax credits (1) |  |  | 1,858 |  |  |  | 456 |
Taxes in recovery process |  |  | 28,881 |  |  |  | 28,225 |
Total |  |  | 57,110 |  |  |  | 32,291 |
| b) | Non-current tax assets
|  | 12/31/2018 |  |  | 12/31/2017 |
|  | ThUS$ |  |  | ThUS$ |
Monthly provisional income tax payments, Chilean companies |  |  | 6,398 |  |  |  | 6,398 |
Specific tax on mining activities paid (on consignment) |  |  | 25,781 |  |  |  | 25,781 |
Total |  |  | 32,179 |  |  |  | 32,179 |
| (1) | These credits are available for Companies and are related to corporate tax payments in April of the following year. These credits include, among others, credits for training expenses (SENCE), credits for acquisition of fixed assets, donations and credits in Chile for taxes paid abroad.
30.2 Current tax liabilities
Current tax liabilities |  | 12/31/2018 |  |  | 12/31/2017 |
|  | ThUS$ |  |  | ThUS$ |
1st Category income tax |  |  | 25,163 |  |  |  | 45,479 |
Foreign company income tax |  |  | 21,097 |  |  |  | 28,996 |
Article 21 single tax |  |  | 1,152 |  |  |  | 927 |
Total |  |  | 47,412 |  |  |  | 75,402 |
Income tax is calculated based on the profit or loss for tax purposes that is applied to the effective tax rate applicable in Chile. As established by Law No.20,780, a progressive income tax rate has been established, which is 27% from 2018. The royalty is determined by applying the taxable rate to the net operating income obtained. According to the chart in force, the Company currently provisioned 5% for mining royalties that involve operations in the Salar de Atacama and 5.64% for caliche extraction operations. The income tax rate for the main countries where the Company operates is presented below :
Country |  | Income tax 2018 |  |  | Income tax 2017 |
Spain |  |  | 25 % |  |  |  | 25 % |
Belgium |  |  | 29.58 % |  |  |  | 33.99 % |
Mexico |  |  | 30% |  |  |  | 30 % |
United States |  |  | 21% + 6% |  |  |  | 34%+6% |
South Africa |  |  | 28% |  |  |  | 28 % |
| 30.3 | Income tax and deferred taxes
Assets and liabilities recognized in the statement of financial position are offset if and only if:
| 1 | The Company has recognized legally before the tax authority the right to offset the amounts recognized in these entries; and
| 2 | Deferred income tax assets and liabilities are derived from income tax related to the same tax authority on:
| (i) | the same entity or tax subject; or
| (ii) | different entities or tax subjects who intend either to settle current fiscal assets and liabilities for their net amount, or to exercise tax assets and pay liabilities simultaneously in each of the future periods in which the Company expects to settle or recover significant amounts of deferred tax assets or liabilities.
Recognized deferred income tax assets are the income taxes that are to be recovered in future periods, related to:
| a) | deductible temporary differences.
| b) | the offsetting of losses obtained in prior periods and not yet subject to tax deduction; and
| c) | the offsetting of unused credits from prior periods.
The Company recognizes a deferred tax asset when there is certainty that these can be offset with tax income from subsequent periods, losses or fiscal credits not yet used, but solely as long as it is more likely than not that there will be tax earnings in the future against which to charge these losses or unused fiscal credits. Recognized deferred tax liabilities refer to the amounts of income taxes payable in future periods related to taxable temporary differences. d.1) Income tax assets and liabilities as of December 31, 2018 are detailed as follows:
| Net liability position |
Description of deferred tax assets and liabilities |  | Assets |  |  | Liabilities |
|  | ThUS$ |  |  | ThUS$ |
Unrealized loss |  |  | 75,832 |  |  |  | - |
Property, plant and equipment and capitalized interest |  |  | - |  |  |  | (196,843 | )
Facility closure provision |  |  | 4,280 |  |  |  | - |
Manufacturing expenses |  |  | - |  |  |  | (103,760 | )
Staff severance indemnities, unemployment insurance |  |  | - |  |  |  | (5,679 | )
Vacation accrual |  |  | 5,155 |  |  |  | - |
Inventory provision |  |  | 28,155 |  |  |  | - |
Materials provision |  |  | 6,239 |  |  |  | - |
Forwards |  |  | 2,169 |  |  |  | - |
Employee benefits |  |  | 3,309 |  |  |  | - |
Research and development expenses |  |  | - |  |  |  | (2,216 | )
Accounts receivable |  |  | 4,188 |  |  |  | - |
Provision for legal complaints and expenses |  |  | 4,013 |  |  |  | - |
Loan approval expenses |  |  | - |  |  |  | (2,337 | )
Junior mining companies (valued based on stock price) |  |  | - |  |  |  | (976 | )
Royalty |  |  | - |  |  |  | (3,278 | )
Tax loss benefit |  |  | 1,124 |  |  |  | - |
Other |  |  | 5,005 |  |  |  | - |
Foreign items (other) |  |  | 259 |  |  |  | - |
Balances to date |  |  | 139,728 |  |  |  | (315,089 | )
Net balance |  |  | - |  |  |  | (175,361 | )
| d.2) | Income tax assets and liabilities as of December 31, 2017 are detailed as follows
|  | Net liability position |
Description of deferred tax assets and liabilities |  | Assets |  |  | Liabilities |
|  | ThUS$ |  |  | ThUS$ |
Unrealized loss |  |  | 68,544 |  |  |  | - |
Property, plant and equipment and capitalized interest |  |  | - |  |  |  | (211,374 | )
Facility closure provision |  |  | 3,469 |  |  |  | - |
Manufacturing expenses |  |  | - |  |  |  | (102,748 | )
Staff severance indemnities, unemployment |  |  | - |  |  |  | (6,792 | )
Vacation accrual |  |  | 4,887 |  |  |  | - |
Inventory provision |  |  | 25,172 |  |  |  | - |
Materials provision |  |  | 7,107 |  |  |  | - |
Forwards |  |  | 624 |  |  |  | - |
Employee benefits |  |  | 2,317 |  |  |  | - |
Research and development expenses |  |  | - |  |  |  | (3,501 | )
Accounts receivable |  |  | 4,253 |  |  |  | - |
Provision for legal complaints and expenses |  |  | 5,243 |  |  |  | - |
Loan approval expenses |  |  | - |  |  |  | (2,670 | )
Junior mining companies (valued based on stock price) |  |  | - |  |  |  | (2,474 | )
Royalty |  |  | - |  |  |  | (4,084 | )
Tax loss benefit |  |  | 1,437 |  |  |  | - |
Other |  |  | 5,002 |  |  |  | - |
Foreign items (other) |  |  | 305 |  |  |  | - |
Balances to date |  |  | 128,360 |  |  |  | (333,643 | )
Net balance |  |  | - |  |  |  | (205,283 | )
| d.3) | Reconciliation of changes in deferred tax liabilities (assets) as of December 31, 2018
|  | Deferred tax liability (asset) at beginning of period |  |  | Deferred tax expense (benefit) recognized in profit (loss) for the year |  |  | Deferred taxes related to items credited (charged) directly to equity |  |  | Total increases (decreases) in deferred tax liabilities (assets) |  |  | Deferred tax liability (asset) at end of period |
|  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |
Unrealized loss |  |  | (68,544 | ) |  |  | (7,288 | ) |  |  | - |  |  |  | (7,288 | ) |  |  | (75,832 | )
Property, plant and equipment and capitalized interest |  |  | 211,374 |  |  |  | (14,531 | ) |  |  | - |  |  |  | (14,531 | ) |  |  | 196,843 |
Facility closure provision |  |  | (3,469 | ) |  |  | (811 | ) |  |  | - |  |  |  | (811 | ) |  |  | (4,280 | )
Manufacturing expenses |  |  | 102,748 |  |  |  | 1,012 |  |  |  | - |  |  |  | 1,012 |  |  |  | 103,760 |
Individual savings plans, unemployment insurance |  |  | 6,792 |  |  |  | (667 | ) |  |  | (446 | ) |  |  | (1,113 | ) |  |  | 5,679 |
Vacation accrual |  |  | (4,887 | ) |  |  | (268 | ) |  |  | - |  |  |  | (268 | ) |  |  | (5,155 | )
Inventory provision |  |  | (25,172 | ) |  |  | (2,983 | ) |  |  | - |  |  |  | (2,983 | ) |  |  | (28,155 | )
Materials provision |  |  | (7,107 | ) |  |  | 868 |  |  |  | - |  |  |  | 868 |  |  |  | (6,239 | )
Forwards |  |  | (624 | ) |  |  | (1,545 | ) |  |  | - |  |  |  | (1,545 | ) |  |  | (2,169 | )
Employee benefits |  |  | (2,317 | ) |  |  | (992 | ) |  |  | - |  |  |  | (992 | ) |  |  | (3,309 | )
Research and development expenses |  |  | 3,501 |  |  |  | (1,285 | ) |  |  | - |  |  |  | (1,285 | ) |  |  | 2,216 |
Accounts receivable |  |  | (4,253 | ) |  |  | 686 |  |  |  | (621 | ) |  |  | 65 |  |  |  | (4,188 | )
Provision for legal complaints and expenses |  |  | (5,243 | ) |  |  | 1,230 |  |  |  | - |  |  |  | 1,230 |  |  |  | (4,013 | )
Loan approval expenses |  |  | 2,670 |  |  |  | (333 | ) |  |  | - |  |  |  | (333 | ) |  |  | 2,337 |
Junior mining companies (valued based on stock price) |  |  | 2,474 |  |  |  | - |  |  |  | (1,498 | ) |  |  | (1,498 | ) |  |  | 976 |
Royalty |  |  | 4,084 |  |  |  | (795 | ) |  |  | (11 | ) |  |  | (806 | ) |  |  | 3,278 |
Tax loss benefit |  |  | (1,437 | ) |  |  | 313 |  |  |  | - |  |  |  | 313 |  |  |  | (1,124 | )
Other |  |  | (5,002 | ) |  |  | (64 | ) |  |  | 61 |  |  |  | (3 | ) |  |  | (5,005 | )
Foreign items (other) |  |  | (305 | ) |  |  | 46 |  |  |  | - |  |  |  | 46 |  |  |  | (259 | )
Total temporary differences, unused losses and unused tax credits |  |  | 205,283 |  |  |  | (27,407 | ) |  |  | (2,515 | ) |  |  | (29,922 | ) |  |  | 175,361 |
| d.4) | Reconciliation of changes in deferred tax liabilities (assets) as of December 31, 2017
|  | Deferred tax liability (asset) at beginning of period |  |  | Deferred tax expense (benefit) recognized in profit (loss) for the year |  |  | Deferred taxes related to items credited (charged) directly to equity |  |  | Total increases (decreases) in deferred tax liabilities (assets) |  |  | Deferred tax liability (asset) at end of period |
|  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |
Unrealized loss |  |  | (86,156 | ) |  |  | 17,612 |  |  |  | - |  |  |  | 17,612 |  |  |  | (68,544 | )
Property, plant and equipment and capitalized interest |  |  | 225,124 |  |  |  | (13,750 | ) |  |  | - |  |  |  | (13,750 | ) |  |  | 211,374 |
Facility closure provision |  |  | (1,589 | ) |  |  | (1,880 | ) |  |  | - |  |  |  | (1,880 | ) |  |  | (3,469 | )
Manufacturing expenses |  |  | 110,630 |  |  |  | (7,882 | ) |  |  | - |  |  |  | (7,882 | ) |  |  | 102,748 |
Individual savings plans, unemployment insurance |  |  | 5,214 |  |  |  | 1,876 |  |  |  | (298 | ) |  |  | 1,578 |  |  |  | 6,792 |
Vacation accrual |  |  | (4,061 | ) |  |  | (826 | ) |  |  | - |  |  |  | (826 | ) |  |  | (4,887 | )
Inventory provision |  |  | (20,684 | ) |  |  | (4,488 | ) |  |  | - |  |  |  | (4,488 | ) |  |  | (25,172 | )
Materials provision |  |  | (7,776 | ) |  |  | 669 |  |  |  | - |  |  |  | 669 |  |  |  | (7,107 | )
Forwards |  |  | (10,206 | ) |  |  | 9,582 |  |  |  | - |  |  |  | 9,582 |  |  |  | (624 | )
Employee benefits |  |  | (6,783 | ) |  |  | 4,466 |  |  |  | - |  |  |  | 4,466 |  |  |  | (2,317 | )
Research and development expenses |  |  | 4,641 |  |  |  | (1,140 | ) |  |  | - |  |  |  | (1,140 | ) |  |  | 3,501 |
Accounts receivable |  |  | (4,305 | ) |  |  | 52 |  |  |  | - |  |  |  | 52 |  |  |  | (4,253 | )
Provision for legal complaints and expenses |  |  | (7,686 | ) |  |  | 2,443 |  |  |  | - |  |  |  | 2,443 |  |  |  | (5,243 | )
Loan approval expenses |  |  | 3,115 |  |  |  | (445 | ) |  |  | - |  |  |  | (445 | ) |  |  | 2,670 |
Junior mining companies (valued based on stock price) |  |  | 1,300 |  |  |  | 624 |  |  |  | 550 |  |  |  | 1,174 |  |  |  | 2,474 |
Royalty |  |  | 6,457 |  |  |  | (2,389 | ) |  |  | 16 |  |  |  | (2,373 | ) |  |  | 4,084 |
Tax loss benefit |  |  | (1,302 | ) |  |  | (135 | ) |  |  | - |  |  |  | (135 | ) |  |  | (1,437 | )
Other |  |  | (266 | ) |  |  | (4,736 | ) |  |  | - |  |  |  | (4,736 | ) |  |  | (5,002 | )
Foreign items (other) |  |  | (212 | ) |  |  | (93 | ) |  |  | - |  |  |  | (93 | ) |  |  | (305 | )
Total temporary differences, unused losses and unused tax credits |  |  | 205,455 |  |  |  | (440 | ) |  |  | 268 |  |  |  | (172 | ) |  |  | 205,283 |
During the period ended December 31, 2018 and December 31, 2017, the Company calculated and accounted for taxable income considering a rate of 27% and 25.5% respectively, in conformity with Law No. 20,780, Tax Reform, published in the Official Gazette on September 29, 2014. The main amendments include a gradual increase in the corporate income tax rate up to 27% starting from 2018.
| d.5) | Deferred taxes related to benefits for tax losses
The Company’s tax loss carryforwards were mainly generated by losses in Chile, which in accordance with current Chilean tax regulations have no expiration date. As of December 31, 2018 and December 31, 2017, tax loss carryforwards are detailed as follows:
|  | 12/31/2018 |  |  | 12/31/2017 |
|  | ThUS$ |  |  | ThUS$ |
Chile |  |  | 1,125 |  |  |  | 1,437 |
Total |  |  | 1,125 |  |  |  | 1,437 |
Tax losses as of December 31, 2018 correspond mainly to SQM S.A., Exploraciones Mineras S.A. Comercial Agrorama S.A., Agrorama Ltd. and SIT S.A.
| d.6) | Unrecognized deferred income tax assets and liabilities
Unrecognized deferred tax assets and liabilities as of December 31, 2018 and December 31, 2017 are as follows:
|  | 12/31/2018 |  |  | 12/31/2017 |
|  | ThUS$ |  |  | ThUS$ |
|  | Assets (liabilities) |  |  | Assets (liabilities) |
Tax losses (NOLs) |  |  | 32 |  |  |  | 37 |
Doubtful accounts impairment |  |  | 47 |  |  |  | 48 |
Inventory impairment |  |  | 947 |  |  |  | 1,347 |
Pensions plan |  |  | 62 |  |  |  | 1 |
Accrued vacations |  |  | 19 |  |  |  | 19 |
Depreciation |  |  | (127 | ) |  |  | (139 | )
Other |  |  | (28 | ) |  |  | (36 | )
Balances to date |  |  | 952 |  |  |  | 1,277 |
| d.7) | Movements in deferred tax assets and liabilities
Movements in deferred tax assets and liabilities as of December 31, 2018 and December 31, 2017 are detailed as follows:
|  | 12/31/2018 |  |  | 12/31/2017 |
|  | ThUS$ |  |  | ThUS$ |
|  | Liabilities (assets) |  |  | Liabilities (assets) |
Deferred tax assets and liabilities, net opening balance |  |  | (205,283 | ) |  |  | (205,455 | )
Increase (decrease) in deferred taxes in profit or loss |  |  | 27,407 |  |  |  | 440 |
Increase (decrease) in deferred taxes in equity |  |  | 2,515 |  |  |  | (268 | )
Balances to date |  |  | (175,361 | ) |  |  | (205,283 | )
| d.8) | Disclosures on income tax expense (income)
The Company recognizes current and deferred taxes as income or expenses, and they are included in profit or loss, unless they arise from:
| (a) | a transaction or event recognized in the same period or in a different period, outside profit or loss either in other comprehensive income or directly in equity; or
| (b) | a business combination
Current and deferred tax expenses (income) are detailed as follows:
|  | 12/31/2018 |  |  | 12/31/2017 |  |  | 12/31/2016 |
|  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |
|  | Income (expenses) |  |  | Income (expenses) |  |  | Income (expenses) |
Current income tax expense |  |  |  |  |  |  |  |  |  |  |  |
Current income tax expense |  |  | (207,959 | ) |  |  | (182,567 | ) |  |  | (149,669 | )
Adjustments to prior year current income tax |  |  | 1,577 |  |  |  | 15,954 |  |  |  | 2,080 |
Current income tax expense, net, total |  |  | (206,382 | ) |  |  | (166,613 | ) |  |  | (147,589 | )
Deferred tax expense |  |  |  |  |  |  |  |  |  |  |  |
Deferred tax expense (income) relating to the creation and reversal of temporary differences |  |  | 27,407 |  |  |  | 440 |  |  |  | 14,624 |
Deferred tax expense, net, total |  |  | 27,407 |  |  |  | 440 |  |  |  | 14,624 |
Tax expense (income) |  |  | (178,975 | ) |  |  | (166,173 | ) |  |  | (132,965 | )
Tax expenses (income) for foreign and domestic parties are detailed as follows:
|  | 12/31/2018 |  |  | 12/31/2017 |  |  | 12/31/2016 |
|  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |
|  | Income (expenses) |  |  | Income (expenses) |  |  | Income (expenses) |
Current income tax expense by foreign and domestic parties, net |  |  |  |  |  |  |  |  |  |  |  |
Current income tax expense, foreign parties, net |  |  | (7,516 | ) |  |  | (14,396 | ) |  |  | (10,844 | )
Current income tax expense, domestic, net |  |  | (198,866 | ) |  |  | (152,217 | ) |  |  | (136,745 | )
Current income tax expense, net, total |  |  | (206,382 | ) |  |  | (166,613 | ) |  |  | (147,589 | )
Deferred tax expense by foreign and domestic parties, net |  |  |  |  |  |  |  |  |  |  |  |
Deferred tax expense, foreign parties, net |  |  | (1,885 | ) |  |  | (154 | ) |  |  | 626 |
Deferred tax expense, domestic, net |  |  | 29,292 |  |  |  | 594 |  |  |  | 13,998 |
Deferred tax expense, net, total |  |  | 27,407 |  |  |  | 440 |  |  |  | 14,624 |
Income tax expense |  |  | (178,975 | ) |  |  | (166,173 | ) |  |  | (132,965 | )
| d.9) | Equity interest in taxation attributable to equity-accounted investees
The Company does not recognize any deferred tax liability in all cases of taxable temporary differences associated with investments in subsidiaries, branches and associated companies or interest in joint ventures, because as indicated in the standard, the following two conditions are jointly met:
| (a) | the parent, investor or interest holder is able to control the time for reversal of the temporary difference; and
| (b) | It is more likely than not that the temporary difference will not be reversed in the foreseeable future.
In addition, the Company does not recognize deferred income tax assets for all deductible temporary differences from investments in subsidiaries, branches and associated companies or interests in joint ventures because it is unlikely that they will meet the following requirements:
| (a) | Temporary differences are reversed in a foreseeable future; and
| (b) | The Company has tax earnings, against which temporary differences can be used.
d.10) Disclosures on the tax effects of other comprehensive income components:
Income tax related to other income and expense components with a charge or credit to net equity |  | Amount before taxes (expense) gain |  |  | Gains (losses) for income taxes |  |  | Amount after taxes |
|  | 12/31/2018 |  |  | 12/31/2018 |  |  | 12/31/2018 |
|  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |
Gain (loss) from defined benefit plans |  |  | (1,327 | ) |  |  | 396 |  |  |  | (931 | )
Cash flow hedge |  |  | 5,723 |  |  |  | - |  |  |  | 5,723 |
Reserve for gains (losses) from financial assets measured at fair value through other comprehensive income |  |  | (5,546 | ) |  |  | 1,498 |  |  |  | (4,048 | )
Total |  |  | (1,150 | ) |  |  | 1,894 |  |  |  | (744 | )
Income tax related to other income and expense components with a charge or credit to net equity |  |  | Amount before taxes (expense) gain |  |  |  | Gains (losses) for income taxes |  |  |  | Amount after taxes |
|  |  | 12/31/2017 |  |  |  | 12/31/2017 |  |  |  | 12/31/2017 |
|  |  | ThUS$ |  |  |  | ThUS$ |  |  |  | ThUS$ |
Gain (loss) from defined benefit plans |  |  | (1,401 | ) |  |  | 282 |  |  |  | (1,119 | )
Cash flow hedge |  |  | 2,184 |  |  |  | - |  |  |  | 2,184 |
Reserve for gains (losses) from financial assets measured at fair value through other comprehensive income |  |  | (26 | ) |  |  | (550 | ) |  |  | (576 | )
Total |  |  | 757 |  |  |  | (268 | ) |  |  | 489 |
Income tax related to other income and expense components with a charge or credit to net equity |  |  | Amount before taxes (expense) gain |  |  |  | Gains (losses) for income taxes |  |  |  | Amount after taxes |
|  |  | 12/31/2016 |  |  |  | 12/31/2016 |  |  |  | 12/31/2016 |
|  |  | ThUS$ |  |  |  | ThUS$ |  |  |  | ThUS$ |
Gain (loss) from defined benefit plans |  |  | (3,397 | ) |  |  | 921 |  |  |  | (2,476 | )
Cash flow hedge |  |  | 2,233 |  |  |  | (470 | ) |  |  | 1,763 |
Reserve for gains (losses) from financial assets measured at fair value through other comprehensive income |  |  | 4,813 |  |  |  | (1,300 | ) |  |  | 3,513 |
Total |  |  | 3,649 |  |  |  | (849 | ) |  |  | 2,800 |
| d.11) | Explanation of the relationship between expense (income) for tax purposes and accounting income.
Based on IAS 12, paragraph 81, letter “c”, the company has estimated that the method that reveals the most significant information for users of the financial statements is the numeric reconciliation between the tax expense (income) and the result of multiplying the accounting profit by the current rate in Chile. The aforementioned election is based on the fact that the main office and subsidiaries established in Chile generate a large part of the Company’s tax expense (income). Reconciliation of numbers in income tax expenses (income) and the result of multiplying financial gain by the rate prevailing in Chile,
|  | Income (expense) |
|  | 12/31/2018 |  |  | 12/31/2017 |  |  | 12/31/2016 |
|  | ThUS$ |  |  | ThUS$ |  |  | ThUS$ |
Consolidated income before taxes |  |  | 621,038 |  |  |  | 594,590 |  |  |  | 414,889 |
Income tax rate in force in Chile |  |  | 27 | % |  |  | 25.5 | % |  |  | 24 | %
Tax expense using the legal rate |  |  | (167,680 | ) |  |  | (151,620 | ) |  |  | (99,573 | )
Effect of royalty tax payments. |  |  | (4,919 | ) |  |  | (3,372 | ) |  |  | (6,311 | )
Tax effect of revenue from regular activities exempt from taxation |  |  | 1,446 |  |  |  | 2,886 |  |  |  | 2,461 |
Tax rate effect of non-tax-deductible expenses for determining taxable profit (loss) |  |  | (4,566 | ) |  |  | (4,764 | ) |  |  | (10,202 | )
Tax effect of tax rates supported abroad |  |  | (8,714 | ) |  |  | (8,061 | ) |  |  | (15,933 | )
IRS provision surplus |  |  | 3,517 |  |  |  | - |  |  |  | - |
Fines affected by Article 21 |  |  | (718 | ) |  |  | (1,517 | ) |  |  | (151 | )
Other tax effects from reconciliation between accounting gains and tax expenses |  |  | 2,659 |  |  |  | 275 |  |  |  | (3,256 | )
Tax expense using the effective rate |  |  | (178,975 | ) |  |  | (166,173 | ) |  |  | (132,965 | )
| d.12) | Tax periods potentially subject to verification:
The Group’s Companies are potentially subject to income tax audits by tax authorities in each country. These audits are limited to a number of interim tax periods, which, in general, when they elapse, give rise to the expiration of these inspections. Tax audits, due to their nature, are often complex and may require several years. Below, we provide a summary of tax periods that are potentially subject to verification, in accordance with the tax regulations in force in the country of origin: Chile According to article 200 of Decree Law No 830, the taxes will be reviewed for any deficiencies in terms of payment and to generate any taxes that might arise. There is a 3-year prescriptive period for such review, dating from the expiration of the legal deadline when payment should have been made. This prescriptive period can be extended to 6 years for the revision of taxes subject to declaration, when such declaration has not been filed or has been presented with maliciously false information. United States In the United States, the tax authority may review tax returns for up to 3 years from the expiration date of the tax return. In the event that an omission or error is detected in the tax return of sales or cost of sales, the review can be extended for a period of up to 6 years. As a result of the audit performed by the tax authority, SQM North America Corp., a subsidiary of the Company, paid in November 2018, for income tax and interest between 2013 and 2015, approximately US$3.8 million. On top of this, SQM North America Corp would have to pay an additional US$0.4 million in state taxes for the same period. These charges are already provisioned in the financial statements. Mexico: In Mexico, the tax authority can review tax returns up to 5 years from the expiration date of the tax return. Spain: In Spain, the tax authority can review tax returns up to 4 years from the expiration date of the tax return. Belgium: In Belgium, the tax authority may review tax returns for up to 3 years from the expiration date of the tax return if no tax losses exist. In the event of detecting an omission or error in the tax return, the review can be extended for a period of up to 5 years. South Africa: In South Africa, the tax authority may review tax returns for up to 3 years from the expiration date of the tax return. In the event that an omission or error in the tax return is detected, the review can be extended for a period of up to 5 years.

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