Chevron 2012 Annual Report Download - page 55

Download and view the complete annual report

Please find page 55 of the 2012 Chevron annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 92

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92

Chevron Corporation 2012 Annual Report 53
Note 14 Taxes – Continued
2012 2011 2010
Balance at January 1 $ 3,481 $ 3,507 $ 3,195
Foreign currency eects 4 (2) 17
Additions based on tax positions
taken in current year 543 469 334
Additions/reductions resulting from
current-year asset acquisitions/sales – (41) –
Additions for tax positions taken
in prior years 152 236 270
Reductions for tax positions taken
in prior years (899) (366) (165)
Settlements with taxing authorities
in current year (138) (318) (136)
Reductions as a result of a lapse
of the applicable statute of limitations (72) (4) (8)
Balance at December 31 $ 3,071 $ 3,481 $ 3,507
e decrease in unrecognized tax benets between
December 31, 2011, and December 31, 2012 was primarily
due to new information received during the fourth quarter
2012 regarding the sustainability of certain U.S. foreign tax
credits. e reduction in unrecognized tax benets related to
these foreign tax credits had no impact on the eective tax
rate since the deferred tax asset recognized for these foreign
tax credits has been oset with a full valuation allowance.
Approximately 67 percent of the $3,071 of unrecog-
nized tax benets at December 31, 2012, would have an
impact on the eective tax rate if subsequently recognized.
Certain of these unrecognized tax benets relate to tax
carryforwards that may require a full valuation allowance
atthe time of any such recognition.
Tax positions for Chevron and its subsidiaries and
aliates are subject to income tax audits by many tax juris-
dictions throughout the world. For the company’s major tax
jurisdictions, examinations of tax returns for certain prior tax years
had not been completed as of December 31, 2012. For these
jurisdictions, the latest years for which income tax examinations
had been nalized were as follows: United States – 2007,
Nigeria – 2000, Angola – 2001, Saudi Arabia – 2003 and
Kazakhstan – 2006.
e company engages in ongoing discussions with tax
authorities regarding the resolution of tax matters in the various
jurisdictions. Both the outcome of these tax matters and the
timing of resolution and/or closure of the tax audits are highly
uncertain. However, it is reasonably possible that developments
on tax matters in certain tax jurisdictions may result in signi-
cant increases or decreases in the company’s total unrecognized
tax benets within the next 12 months. Given the number of
years that still remain subject to examination and the number
of matters being examined in the various tax jurisdictions, the
company is unable to estimate the range of possible adjust-
ments to the balance of unrecognized tax benets.
e company is currently assessing the potential impact of
an August 2012 decision by the U.S. Court of Appeals for the
ird Circuit that disallows the Historic Rehabilitation Tax
Credits (HRTCs) claimed by an unrelated taxpayer. e com-
pany has claimed a signicant amount of HRTCs on its U.S.
federal income tax returns in open years, and it is reasonably
possible that the specic ndings from management’s ongoing
assessment and evaluation could result in a signicant increase
in the company’s unrecognized tax benet within the next 12
months. Any such increase would impact the eective tax rate.
On the Consolidated Statement of Income, the company
reports interest and penalties related to liabilities for uncertain
tax positions as “Income tax expense.” As of December 31,
2012, accruals of $293 for anticipated interest and penalty
obligations were included on the Consolidated Balance Sheet,
compared with accruals of $118 as of year-end 2011. Income
tax expense (benet) associated with interest and penalties was
$145, $(64) and $40 in 2012, 2011 and 2010, respectively.
Taxes Other an on Income
Year ended December 31
2012 2011 2010
United States
Excise and similar taxes on
products and merchandise $ 4,665 $ 4,199 $ 4,484
Import duties and other levies 1 4 –
Property and other
miscellaneous taxes 782 726 567
Payroll taxes 240 236 219
Taxes on production 328 308 271
Total United States 6,016 5,473 5,541
International
Excise and similar taxes on
products and merchandise 3,345 3,886 4,107
Import duties and other levies 106 3,511 6,183
Property and other
miscellaneous taxes 2,501 2,354 2,000
Payroll taxes 160 148 133
Taxes on production 248 256 227
Total International 6,360 10,155 12,650
Total taxes other than on income $ 12,376 $ 15,628 $ 18,191