GameStop 2008 Annual Report Download - page 93

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12. Income Taxes
The provision for income tax consisted of the following:
52 Weeks
Ended
January 31,
2009
52 Weeks
Ended
February 2,
2008
53 Weeks
Ended
February 3,
2007
(In thousands)
Current tax expense:
Federal ....................................... $168,935 $ 34,107 $32,127
State......................................... 13,874 5,149 2,370
Foreign....................................... 39,999 31,874 18,894
222,808 71,130 53,391
Deferred tax expense (benefit):
Federal ....................................... (15,858) (2,582) 571
State......................................... (7,468) (1,805) (2,149)
Foreign....................................... (1,375) (8,764) (1,502)
(24,701) (13,151) (3,080)
Charge in lieu of income taxes, relating to the tax effect of
stock-based awards tax deduction ................... 37,562 94,786 45,735
Total income tax expense ........................... $235,669 $152,765 $96,046
The components of earnings before income tax expense consisted of the following:
52 Weeks
Ended
January 31,
2009
52 Weeks
Ended
February 2,
2008
53 Weeks
Ended
February 3,
2007
(In thousands)
United States .................................... $532,787 $364,929 $211,814
International ..................................... 101,164 76,127 42,482
Total .......................................... $633,951 $441,056 $254,296
The difference in income tax provided and the amounts determined by applying the statutory rate to income
before income taxes resulted from the following:
52 Weeks
Ended
January 31,
2009
52 Weeks
Ended
February 2,
2008
53 Weeks
Ended
February 3,
2007
Federal statutory tax rate ........................... 35.0% 35.0% 35.0%
State income taxes, net of federal effect ................ 1.1 0.5 2.0
Foreign income taxes .............................. 0.5 (0.8) 0.7
Other (including permanent differences) ................ 0.6 (0.1) 0.1
37.2% 34.6% 37.8%
The Company’s effective tax rate increased from 34.6% in the 52 weeks ended February 2, 2008 to 37.2% in
the 52 weeks ended January 31, 2009, primarily due to expenses related to the mergers and acquisitions and
associated corporate structuring. The Company’s effective tax rate decreased from 37.8% in the 53 weeks ended
February 3, 2007 to 34.6% in the 52 weeks ended February 2, 2008 primarily due to the release of valuation
F-26
GAMESTOP CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)