Costco 2008 Annual Report Download - page 78
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The provisions for income taxes for 2008, 2007 and 2006 are as follows:
2008 2007 2006
Federal:
Current .............................. $408,248 $478,165 $442,039
Deferred ............................. 35,261 (74,105) (23,799)
Total federal ...................... 443,509 404,060 418,240
State:
Current .............................. 84,013 81,352 67,959
Deferred ............................. (7,411) (9,595) (7,806)
Total state ........................ 76,602 71,757 60,153
Foreign:
Current .............................. 138,414 118,569 118,040
Deferred ............................. (4,032) (9,089) (3,168)
Total foreign ...................... 134,382 109,480 114,872
Tax benefits allocated to contributed capital .... 61,756 41,922 54,937
Total provision for income taxes .............. $716,249 $627,219 $648,202
The reconciliation between the statutory tax rate and the effective rate for 2008, 2007 and 2006 is as
follows:
2008 2007 2006
Federal taxes at statutory
rate .................... $699,641 35.00% $598,497 35.00% $612,996 35.00%
State taxes, net ............ 50,691 2.54 42,480 2.48 42,338 2.42
Foreign taxes, net .......... (23,410) (1.17) (6,840) (0.40) 1,701 0.10
Tax benefit (provision) on
unremitted earnings ....... 4,520 0.23 (155) (0.01) (11,978) (0.68)
Translation gain on unremitted
earnings ................ — — — — 5,333 0.30
Other .................... (15,193) (0.77) (6,763) (0.39) (2,188) (0.13)
Total ................. $716,249 35.83% $627,219 36.68% $648,202 37.01%
The components of the deferred tax assets and liabilities are as follows:
2008 2007
Stock options ............................................. $ 97,618 $ 87,700
Deferred income/membership fees ............................ 62,131 51,876
Excess foreign tax credits ................................... 3,664 2,613
Accrued liabilities and reserves ............................... 431,706 356,850
Other .................................................... 58,930 20,739
Total deferred tax assets ................................ 654,049 519,778
Property and equipment .................................... 350,893 302,765
Merchandise inventories .................................... 146,426 109,237
Translation gain ........................................... 5,006 5,079
Total deferred tax liabilities .............................. 502,325 417,081
Net deferred tax assets ..................................... $151,724 $102,697
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