Twenty-First Century Fox 2008 Annual Report Download - page 124

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NEWSCORP
Notes to the Consolidated Financial Statements (continued)
Note 17 INCOME TAXES
Income from continuing operations before income tax expense and minority interest in subsidiaries was attributable to the following jurisdictions:
2008 2007 2006
For the years ended June 30, (in millions)
United States (including exports) $6,332 $4,586 $3,748
Foreign 989 720 657
Income from continuing operations before income tax expense and minority interest in
subsidiaries $ 7,321 $5,306 $4,405
Significant components of the Company’s provisions for income taxes from continuing operations were as follows:
2008 2007 2006
For the years ended June 30, (in millions)
Current:
United States
Federal $ 918 $ 281 $ 145
State & local 102 69 66
Foreign 480 390 357
Total current 1,500 740 568
Deferred 303 1,074 958
Total provision for income taxes $1,803 $1,814 $1,526
In October 2004, the American Jobs Creation Act (the “AJCA”) was signed into law. The AJCA includes a temporary incentive for U.S.
multinationals to repatriate foreign earnings at the favorable effective tax rate of 5.25%. In accordance with the AJCA, the Company repatriated
$420 million at a favorable tax rate of 5.25% in fiscal 2006, which resulted in a tax benefit to the Company of approximately $125 million. The
amounts repatriated were used to compensate non-executive U.S. employees for services performed within the United States.
The reconciliation of income tax attributable to continuing operations computed at the statutory rate to income tax expense is:
For the years ended June 30, 2008 2007 2006
US federal income tax rate 35% 35% 35%
Tax free Exchange (a) (11) — —
State and local taxes 1 1 2
Effect of foreign taxes 1 2 1
AJCA Section 965 Benefit — — (3)
Resolution of tax matters — (2) —
Change in valuation allowance (1) (1) (1)
Other permanent differences — (1) 1
Effective tax rate 25% 34% 35%
(a) See Note 3—Acquisitions, Disposals and Other Transactions.
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