INCOME TAX EXPENSE

9 Months Ended

Mar. 27, 2022

Income Tax Disclosure [Abstract]

INCOME TAX EXPENSE

INCOME TAX EXPENSE

The Company’s provision for income taxes and effective tax rate are as follows:

	Three Months Ended						Nine Months Ended
	March 27, 2022			March 28, 2021			March 27, 2022			March 28, 2021
	(in thousands, except percentages)
Income tax expense	$	112,917		$	88,867		$	437,857		$	298,242
Effective tax rate	10.0		%	7.7		%	11.4		%	9.7		%

The difference between the U.S. federal statutory tax rate of 21% and the Company’s effective tax rate for the three and nine months ended March 27, 2022 and March 28, 2021 was primarily due to income in lower tax jurisdictions.

The Company transferred its international sales operations from Switzerland to Malaysia, effective from fiscal year 2022. Through fiscal year 2036, the Company expects to operate under various tax incentives in Malaysia which provide exemptions on foreign income earned and are contingent upon meeting certain conditions.

The Internal Revenue Service (“IRS”) is examining the Company’s U.S. federal income tax return for the fiscal year ended June 24, 2018. As of March 27, 2022, no significant adjustments have been proposed by the IRS. The Company is unable to make a reasonable estimate as to when cash settlements, if any, with the IRS will occur.

The Company is in various stages of examinations in connection with all of its tax audits worldwide, and it is difficult to determine when these examinations will be settled. It is reasonably possible that over the next 12-month period the Company may experience an increase or decrease in its uncertain tax positions as a result of tax examinations or lapses of statutes of limitation. The change in uncertain tax positions as a result of lapses of statutes of limitation may range up to $11.3 million.