Income Taxes

6 Months Ended

Jun. 30, 2020

Income Tax Disclosure [Abstract]

Income Taxes [Text Block]

8. Income Taxes

Our effective income tax rate for the three months ended June 30, 2020 was -11.3% compared with 14.4% for the three months ended June 30, 2019. For the six months ended June 30, 2020, the effective income tax rate was 8.6% compared with 16.9% for the six months ended June 30, 2019. Our effective income tax rate fluctuates based on, among other factors, changes in pretax income in countries with varying statutory tax rates, changes in valuation allowances, changes in foreign exchange gains/losses, the amount of exempt income, changes in unrecognized tax benefits associated with uncertain tax positions, and changes in tax laws.

On March 27, 2020, the U.S. enacted the Coronavirus Aid, Relief, and Economic Security Act, also known as the “CARES Act,” which contains numerous income tax provisions and other stimulus measures. We anticipate that several of the tax measures will favorably impact our income tax on our Consolidated Financial Statements for the year ended December 31, 2020. Based on our analysis as of June 30, 2020, we recorded an overall tax benefit including a remeasurement of our deferred income tax balances. We continue to assess the impact that the CARES Act will have on our Company.

Compared with the three and six months ended June 30, 2019, the lower effective tax rate for the three and six months ended June 30, 2020 was primarily attributable to an anticipated benefit resulting from various provisions of the CARES Act and to the increased relative impact of exempt income due to decreased pretax income. This is partially offset by changes in the pretax income in countries with varying statutory tax rates and tax benefits related to prior year research and development activities.