This item includes current income tax expense as well as income/expense from deferred taxes (changes in deferred tax assets and deferred tax liabilities) and comprises the following:
|
2021 |
2020 |
|---|---|---|
Current income tax expense |
|
|
Austria |
15,893 |
5,947 |
Abroad |
32,481 |
16,131 |
|
48,374 |
22,077 |
|
|
|
Income/expense from deferred taxes |
6,838 |
10,768 |
Total |
55,212 |
32,846 |
|
2021 |
2020 |
|---|---|---|
Current income tax expense |
|
|
Tax expense for current year |
51,018 |
20,549 |
Reduction due to the use of tax losses |
(7,846) |
(81) |
Adjustment for prior-period income tax |
5,203 |
1,609 |
|
48,374 |
22,077 |
|
|
|
Income/expense from deferred taxes |
|
|
Recognition and reversal of temporary differences |
712 |
18,795 |
Effects of changes in tax rates |
849 |
41 |
Change in capitalized loss carryforwards |
4,524 |
(6,724) |
Effects of previously unrecognized temporary differences from prior periods |
846 |
(1,329) |
Changes in valuation adjustment to deferred tax assets (excl. loss carryforwards) |
(93) |
(15) |
|
6,838 |
10,768 |
|
|
|
Total |
55,212 |
32,846 |
The item “Change in capitalized loss carryforwards” relates to the utilization of loss carryforwards in the amount of EUR 3,271 thousand (2020: EUR 61 thousand) and an adjustment to deferred tax assets for loss carryforwards not yet utilized amounting to EUR 1,253 thousand (2020: EUR minus 6,785 thousand).
The reconciliation of calculated income tax expense based on the Austrian corporate tax rate of 25 percent (December 31, 2020: 25 percent) to effective income tax expense is shown in the following table:
|
2021 |
2020 |
|---|---|---|
Earnings before tax (EBT) |
182,926 |
22,251 |
Calculated income tax expense (25 % of earnings before tax) |
45,732 |
5,563 |
Deductible distribution of hybrid coupon |
(7,188) |
0 |
Tax-free income and tax allowances (particularly research allowance) |
(2,055) |
(2,348) |
Non-deductible expenses, withholding taxes and similar permanent differences |
2,313 |
2,398 |
Income from investments accounted for using the equity method |
468 |
(1,418) |
Effect of different tax rates |
(5,374) |
(2,304) |
Changes in tax rates |
849 |
41 |
Taxes from prior periods |
6,049 |
280 |
Exchange rate differences resulting from the translation of deferred tax items from local into functional currency |
7,902 |
10,414 |
Change in unrecognized deferred tax assets from loss carryforwards, tax credits and other temporary differences |
6,637 |
18,309 |
Other |
(121) |
1,910 |
Effective income tax expense |
55,212 |
32,846 |
As in the previous year, the ratio of effective income tax expense to earnings before tax is disproportionately high in the 2021 financial year. As in the previous year, the Group reports a relatively high level of reconciliation items arising from write-downs on tax assets (in particular from non-capitalized start-up losses) and from the translation of tax items from local to functional currency (in particular Indonesia, Brazil and Thailand). In addition, in the 2021 financial year a distribution to hybrid capital holders was realized that is tax deductible. For the item “Taxes from prior periods,” see the notes relating to write-downs in note 31.
The item “Changes in tax rates” mainly comprises a statutory tax rate increase in the UK. The corporate income tax rate in the UK will increase from 19 percent to 25 percent effective April 1, 2023. This resulted in an expense of EUR 941 thousand in the 2021 financial year from the measurement of the UK Group companies’ deferred tax assets and deferred tax liabilities.
The item “taxes from prior periods” includes a tax credit of EUR 747 thousand (2020: EUR 24 thousand) from the tax group with B&C Group (also see note 40).
Lenzing AG and the Austrian subsidiaries of the Lenzing Group are subject to an income tax rate of 25 percent (December 31, 2020: 25 percent). The income tax rates for foreign companies range from 11 percent to 34 percent (December 31, 2020: from 11 percent to 34 percent).