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Income Taxes
3 Months Ended
Jan. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Applied’s provision for income taxes and effective tax rate are affected by the geographical composition of pre-tax income which includes jurisdictions with differing tax rates, conditional reduced tax rates and other income tax incentives. It is also affected by events that are not consistent from period to period, such as changes in income tax laws and the resolution of prior years’ income tax filings.
On December 27, 2020, the U.S. government enacted the Consolidated Appropriations Act. The enactment of this Act does not result in any material adjustments to Applied’s provision for income taxes.
Applied’s effective tax rates for the first quarter of fiscal 2021 and 2020 were 8.9 percent and 11.2 percent, respectively. The effective tax rate for the first quarter of fiscal 2021 was lower than the same period in the prior fiscal year primarily due to a tax benefit related to severance and related charges recorded in the first quarter of fiscal 2021 and higher income in Singapore, which is subject to a lower tax rate. These tax benefits were partially offset by the reduction in excess tax benefits from stock-based compensation in the first quarter of fiscal 2021 when compared to the first quarter of the prior fiscal year.