XML 50 R13.htm IDEA: XBRL DOCUMENT v3.2.0.727
Income Taxes
6 Months Ended
Jun. 30, 2015
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes

We recorded income tax expense at an effective rate of 38.3% for the three months ended June 30, 2015, as compared to an effective rate of 38.8% for the three months ended June 30, 2014. The 2015 rate was favorably impacted by the effect of discrete tax items, partially offset by the unfavorable impact of the strengthening of the United States dollar resulting in a decrease to non-U.S. income. The 38.3% effective tax rate in the quarter was higher than the United States Federal statutory rate of 35%, and we currently expect an annual effective tax rate of approximately 38%, due primarily to the French business tax, expected repatriations, valuation allowances and other permanent items.

We recorded income tax expense at an effective rate of 39.6% for the six months ended June 30, 2015, as compared to an effective rate of 39.5% for the six months ended June 30, 2014. The 39.6% effective tax rate for the six months ended June 30, 2015 was higher than the United States Federal statutory rate of 35% due primarily to the French business tax, repatriations, valuation allowances and other permanent items.

As of June 30, 2015, we had gross unrecognized tax benefits related to various tax jurisdictions, including interest and penalties, of $32.2. We had related tax benefits of $1.4, and the net amount of $30.8 would favorably impact the effective tax rate if recognized. As of December 31, 2014, we had gross unrecognized tax benefits related to various tax jurisdictions, including interest and penalties, of $30.8. We had related tax benefits of $1.4 for a net amount of $29.4. We do not expect our unrecognized tax benefits to change significantly over the next 12 months.
 
We conduct business globally in 80 countries and territories. We are routinely audited by the tax authorities of the various tax jurisdictions in which we operate. Generally, the tax years that could be subject to examination are 2008 through 2014 for our major operations in France, Germany, Italy, Japan, the United Kingdom and the United States. As of June 30, 2015, we are subject to tax audits in Austria, Canada, Denmark, France, Germany, Norway, Russia and Spain. We believe that the resolution of these audits will not have a material impact on earnings.