Income taxes

6 Months Ended

Feb. 29, 2020

Income Tax Disclosure [Abstract]

Income taxes

Income taxes

The effective tax rate for the three and six months ended February 29, 2020 was 14.6% and 9.7%, respectively, compared to 16.7% and 15.5% for the three and six months ended February 28, 2019, respectively. The decrease in the effective tax rate for the three months ended February 29, 2020 was primarily due to the mix of earnings between U.S and international operations. The decrease in the effective tax rate for the six months ended February 29, 2020 was primarily due to discrete tax benefits recorded from the reduction of a valuation allowance on net deferred tax assets related to anticipated capital gains.

Income taxes paid for the six months ended February 29, 2020 were $592 million, compared to $766 million for the six months ended February 28, 2019.

On December 2, 2019, the Internal Revenue Service issued final regulations relating to the base erosion and anti-avoidance tax (“BEAT”) provisions and the foreign tax credit regime under the U.S. tax law changes enacted in December 2017. The Company has evaluated the impact of the regulations and determined that there is no material impact to its financial statements.