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Income Taxes
 3 Months Ended
Mar. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes
12. Income Taxes
Our income tax provision and the respective effective income tax rates are as follows (in millions, except for income tax rates):
For the Three Months Ended March 31,
20242023
Provision for income taxes$3.3 $4.2 
Effective income tax rate11.0 %15.6 %
Our provision for income taxes for the three months ended March 31, 2024 includes a net discrete income tax benefit of $5.1 million, of which a tax benefit of $2.5 million relates to return-to-provision adjustments and a net tax benefit of $2.4 million relates to changes in our uncertain tax positions.
For the three months ended March 31, 2023, the provision included a net discrete income tax benefit of $3.8 million, of which $3.1 million related to the reversal of a valuation allowance previously recorded against a U.S. state's deferred tax assets and a net tax benefit of $0.7 million related to other worldwide adjustments, including changes resulting from tax return filings.
Our income tax provisions for the three months ended March 31, 2024 and 2023 were calculated based on the estimated annual effective income tax rates for the 2024 and 2023 years, respectively. The actual effective income tax rate for the 2024 year may be materially different for several reasons including differences between estimated versus actual results and the geographic tax jurisdictions in which the results are earned.
On October 4, 2021, 136 members of the Organization for Economic Co-operation and Development ("OECD") agreed to a global minimum tax rate of 15%. On December 20, 2021, OECD published its model rules on the agreed minimum tax known as the Global Anti-Base Erosion ("GloBE") rules. The GloBE rules provide a framework for a coordinated multi-country system of taxation intended to ensure large multinational enterprise groups pay a minimum level of tax on the income arising in each of the jurisdictions where they operate. On December 14, 2022, the European Council approved its directive to implement Pillar Two of the GloBE rules regarding a 15% global minimum tax rate. Many EU countries have already indicated they plan to enact certain provisions of this directive as of January 1, 2024. In addition, many G20 nations have indicated their plan to follow the OECD guidance as early as January 1, 2024. Pillar Two legislation has been enacted or substantively enacted in certain jurisdictions in which the Company operates. The legislation is effective for the Company’s financial year beginning January 1, 2024.
The Company has completed its assessment and identified potential exposure to Pillar Two income taxes on profits earned in jurisdictions where the effective tax rate is lower than 15%. The estimated Pillar Two taxes do not have a material impact on the estimated annual effective tax rate for 2024 or the income tax provision for the quarter.
We have various tax returns under examination both in the U.S. and foreign jurisdictions. The most material of these is in Denmark for the 2013 - 2019 tax years, where one of our subsidiaries has been under audit since 2018. Through March 31, 2024, we have received final tax assessments for the 2013 and 2014 tax years that were immaterial, a proposed tax assessment for the 2015 tax year of approximately $13.9 million (DKK 96.1 million), and proposed tax assessments for the 2016 and 2017 tax years of approximately $19.4 million (DKK 133.8 million) and $22.5 million (DKK 155.5 million), respectively. On April 24, 2024, we received proposed tax assessments for the 2018 and 2019 tax years of approximately $21.7 million (DKK 149.7 million) and $30.6 million (DKK 211.2 million), respectively. We believe we have substantial defenses to these assessments and expect to continue to pursue available administrative and judicial remedies to resolve this matter.
An unfavorable resolution of one or more of the above matters could have a material adverse effect on our operating results or cash flows in the quarter or year in which the adjustments are recorded, or the tax is due or paid. As examinations are still in process or have not yet reached the final stages of the appeals process, the timing of the ultimate resolution or payments that may be required cannot be determined at this time.