8. Income Taxes

The income tax provision (credit) differs from the amounts determined by applying the statutory federal income tax rate of 34% to the income (loss) before income tax provision (credit) for the following reasons (dollars in thousands):


	Three Months Ended
	March 31,
	2017		2016
Income tax at federal rate	$	(1,135)	$	88
Increase (decrease) resulting from:
State income taxes, net of federal income tax		(123)		12
Expense not deductible for tax		—		16
Tax credit included in taxable income		93		—
Other permanent differences		52		4
Capital goods excise tax credit		(273)		(14)
Total income tax provision (credit)	$	(1,386)	$	106

The Company evaluates its tax positions for liability recognition. As of March 31, 2017, the Company had no unrecognized tax benefits. No interest or penalties related to income tax assessments were recognized in the Company’s condensed consolidated statements of income (loss) for the three months ended March 31, 2017 and 2016. All tax years from 2013 remain open for both federal and Hawaii state tax purposes.