Income Taxes

Arconic’s year-to-date tax provision is comprised of the most recent estimated annual effective tax rate applied to year-to-date pre-tax ordinary income. The tax impact of unusual or infrequently occurring items, including changes in judgment about valuation allowances and effects of changes in tax laws or rates, are recorded discretely in the interim period in which they occur. In addition, the tax provision is adjusted for the interim period impact of non-benefited pre-tax losses.

For the first quarter of 2019 and 2018, the estimated annual effective tax rate, before discrete items, applied to ordinary income was 25.9% and 26.5%, respectively. The rate in each period was higher than the U.S. federal statutory rate of 21% primarily due to additional estimated U.S. tax on Global Intangible Low-Taxed Income, domestic taxable income in certain U.S. states no longer subject to valuation allowance, and foreign income taxed in higher rate jurisdictions.

For the first quarter of 2019 and 2018, the tax rate including discrete items was 27.2% and 28.1%, respectively and included a discrete charge of $1 related to other items in the first quarter of 2019 and a discrete tax charge of $2 related to stock compensation in the first quarter of 2018.

The tax provisions for the first quarter of 2019 and 2018 were comprised of the following:



	First quarter ended
	March 31,
	2019		2018
Pre-tax income at estimated annual effective income tax rate before discrete items	$	67	$	53
Interim period treatment of operational losses in foreign jurisdictions for which no tax benefit is recognized	2		1
Other discrete items	1		2
Provision for income taxes	$	70	$	56