Income tax provision

9 Months Ended

Sep. 30, 2012

Income tax provision

Note 11—Income tax provision:

	Nine months ended September 30,
	2011			2012
	(In millions)
Expected tax provision at U.S. federal statutory income tax rate of 35%	$	28.7		$	27.2
Non-U.S. tax rates		(.9	)		(.7	)
Incremental U.S. tax and rate differences on equity in earnings		(6.6	)		(6.1	)
U.S. state income taxes, net		.4			.4
Tax rate change		(1.4	)		—
Other, net		(.8	)		(.9	)
Total	$	19.4		$	19.9

Tax authorities are examining certain of our U.S. and non-U.S. tax returns and have or may propose tax deficiencies, including penalties and interest. We cannot guarantee these tax matters will be resolved in our favor due to the inherent uncertainties involved in settlement initiatives and court and tax proceedings. We believe we have adequate accruals for additional taxes and related interest expense which could ultimately result from tax examinations. We believe the ultimate disposition of tax examinations should not have a material adverse effect on our consolidated financial position, results of operations or liquidity.

In 2011 and 2012, Kronos received notices of re-assessment from the Canadian federal and provincial tax authorities related to the years 2002 through 2004. Kronos objects to the re-assessments and believes the position is without merit. Accordingly, the re-assessments are being appealed. If the full amount of the proposed adjustment were ultimately to be assessed against Kronos, the cash tax liability would be approximately $15.9 million. Kronos believes that it has adequate accruals for this matter.

In the first nine months of 2011, CompX recognized a $2.1 million provision for deferred income taxes related to the undistributed earnings of its Canadian subsidiary attributable to the $7.5 million litigation settlement gain discussed in Note 12.

We currently estimate that our unrecognized tax benefits will not change materially during the next twelve months.