Income Taxes

9 Months Ended

Jan. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

. Income Taxes

Income tax expense of $399,000 and $845,000 was recorded for the three and nine months ended January 31, 2022, respectively. Income tax benefit of $813,000 and $989,000 was recorded for the three and nine months ended January 31, 2021, respectively. The effective tax rates were (45.0)% and (17.5)% for the three and nine months ended January 31, 2022, respectively. The effective tax rates were 113.2% and 59.3% for the three and nine months ended January 31, 2021, respectively. The change in the effective tax rate for the three- and nine-month periods is primarily due to the impact of foreign operations which are taxed at different rates than the U.S. tax rate of 21% and the recording of a valuation allowance against the deferred tax asset which resulted in the elimination of any U.S. income tax benefit.

In August 2019, the Company revoked its indefinite reinvestment of foreign unremitted earnings position in compliance with ASC 740 "Income Taxes" and terminated its indefinite reinvestment of unremitted earnings assertion for the Singapore, China, and Kewaunee Labway India Pvt. Ltd. international subsidiaries. The Company has a deferred tax liability of $895,000 and $776,000 for the withholding tax related to Kewaunee Labway India Pvt. Ltd. as of January 31, 2022 and April 30, 2021, respectively. The Company recorded all deferred tax assets and liabilities related to its outside basis differences in its foreign subsidiaries consistent with ASC 740.