INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2021

The sources of deferred income tax balances are as follows:


	As of December 31,
US$ MILLIONS	2021		2020
Deferred income tax assets
Financial instruments and other	$	17	$	18
Tax losses carried forward	43		34
	$	60	$	52
Deferred income tax liabilities
Property, plant and equipment	$	(1,635)	$	(643)
Intangible assets	(11)		(809)
	$	(1,646)	$	(1,452)
Net deferred income tax liabilities	$	(1,586)	$	(1,400)
Reflected in the statement of financial position as follows:
Deferred tax assets	$	52	$	43
Deferred tax liabilities	(1,638)		(1,443)
Net deferred tax liabilities	$	(1,586)	$	(1,400)

The sources of deferred income tax balances and movements are as follows:


			Recognized in
US$ MILLIONS	Jan. 1, 2021		Net Income		Other Comprehensive Income		Other(1)		Acquisitions/Dispositions		Dec. 31, 2021
Deferred tax assets related to non-capital losses and capital losses	$	34	$	9	$	—	$	—	$	—	$	43
Deferred tax liabilities related to differences in tax and book basis, net	(1,434)		(180)		(121)		66		40		(1,629)
Net deferred tax liabilities	$	(1,400)	$	(171)	$	(121)	$	66	$	40	$	(1,586)


			Recognized in
US$ MILLIONS	Jan. 1, 2020		Net Income		Other Comprehensive Income		Other(1)		Acquisitions/Dispositions		Dec. 31, 2020
Deferred tax assets related to non-capital losses and capital losses	$	31	$	2	$	—	$	1	$	—	$	34
Deferred tax liabilities related to differences in tax and book basis, net	(1,455)		(104)		(68)		193		—		(1,434)
Net deferred tax liabilities	$	(1,424)	$	(102)	$	(68)	$	194	$	—	$	(1,400)

(1)Other items relate to foreign exchange as deferred income taxes are calculated based on the functional currency of each operating entity.


	For the year ended December 31,
US$ MILLIONS	2021		2020		2019
Deferred tax arising on income and expenses recognized in other comprehensive income
Revaluation of property, plant and equipment	$	121	$	67	$	59
Cash flow hedges	—		1		1
Total income tax recognized directly in other comprehensive income	$	121	$	68	$	60

The major components of income tax expense include the following:


	For the year ended December 31,
US$ MILLIONS	2021		2020		2019
Tax expense comprises:
Current income tax expense	$	234	$	167	$	175
Deferred income tax expense
Origination and reversal of temporary differences	59		67		89
Change in tax rates or the imposition of new taxes	96		27		—
Deferred tax assets not recognized	16		8		8
Total income tax expense	$	405	$	269	$	272
Income tax on income before tax and non-controlling interests reconciles to tax expense as follows:
Net income before income tax and non-controlling interests	$	432	$	37	$	842
Income tax expense calculated at the domestic rates applicable to profits in the country concerned	179		70		267
Change in tax rates and new legislation	96		27		—
International operations subject to different tax rates	(2)		(3)		(3)
Taxable income attributable to non-controlling interests	(4)		(5)		(6)
Portion of gains subject to different tax rates	(37)		—		8
Deferred tax assets not recognized	16		8		8
Foreign exchange	2		17		—
Non-deductible dividends on exchangeable shares	30		18		—
Non-deductible remeasurement adjustments on exchangeable and class B shares	119		136		—
Permanent differences and other	6		1		(2)
Income tax expense recognized in profit or loss	$	405	$	269	$	272