18. INCOME TAXES

As our investments are predominantly owned by Dutch holding companies, the components of the provision for income taxes and of the income / (loss) before tax have been analyzed between their Netherlands and non-Netherlands components. Similarly the Dutch corporate income tax rates have been used in the reconciliation of income taxes.

Income / (loss) from continuing operations before income taxes

The Netherlands and non-Netherlands components of income / (loss) from continuing operations before income taxes are:



	For The Year Ended December 31,
	2018			2017			2016
Domestic	$	(38,434	)	$	(50,344	)	$	(66,517	)
Foreign	163,327			123,911			(106,523		)
Total	$	124,893		$	73,567		$	(173,040	)

Total tax provision for the years ended December 31, 2018, 2017 and 2016 was allocated as follows:



	For The Year Ended December 31,
	2018			2017			2016
Income tax provision from continuing operations	$	(27,828	)	$	(22,504	)	$	(6,639	)
Income tax provision from discontinued operations	(1,423		)	(1,226		)	(678		)
Total tax provision	$	(29,251	)	$	(23,730	)	$	(7,317	)

Provision for Income Taxes

The Netherlands and non-Netherlands components of the provision for income taxes from continuing operations consist of:



	For The Year Ended December 31,
	2018			2017			2016
Current income tax provision:
Domestic	$	—		$	—		$	—
Foreign	(25,308		)	(22,273		)	(4,781		)
	(25,308		)	(22,273		)	(4,781		)
Deferred tax provision:
Domestic	—			—			—
Foreign	(2,520		)	(231		)	(1,858		)
	(2,520		)	(231		)	(1,858		)
Provision for income taxes	$	(27,828	)	$	(22,504	)	$	(6,639	)

In 2017 and 2016, the net provision for income taxes is more than the provision computed at statutory tax rates primarily due to losses on which no tax benefit has been received.

Reconciliation of Effective Income Tax Rate

The following is a reconciliation of income taxes, calculated at statutory Netherlands rates, to the provision for income taxes included in the accompanying consolidated statements of operations and comprehensive income / loss for the years ended December 31, 2018, 2017 and 2016:



	For The Year Ended December 31,
	2018			2017			2016
Income taxes at Netherlands rates (25%)	$	(31,206	)	$	(18,378	)	$	43,251
Jurisdictional differences in tax rates	10,384			7,303			(41,858		)
Non-deductible interest	(2,455		)	(248		)	(796		)
Losses expired	(7,111		)	(7,583		)	(1,847		)
Change in valuation allowance ⁽¹⁾	26,042			(6,242		)	(5,863		)
Unrecognized tax benefits	1,077			—			(925		)
Effect of change in tax rate ⁽¹⁾	(21,982		)	—			575
Non-deductible expenses	(879		)	207			921
Other	(1,698		)	2,437			(97		)
Provision for income taxes	$	(27,828	)	$	(22,504	)	$	(6,639	)


⁽¹⁾	The effect of change in tax rate in 2018 is the impact of tax rates enacted in the Netherlands on the tax benefit of loss carry-forwards. The tax benefit is fully offset by a release in the corresponding valuation allowance which was previously recorded against the loss carry-forwards deferred tax asset, resulting in no net impact to the provision for income taxes.

Components of Deferred Tax Assets and Liabilities

The following table shows the significant components included in deferred income taxes as at December 31, 2018 and 2017:



	December 31, 2018			December 31, 2017
Assets:
Tax benefit of loss carry-forwards and other tax credits	$	103,468		$	133,258
Programming rights	2,211			3,189
Property, plant and equipment	3,088			3,494
Accrued expenses	3,922			4,087
Other	2,997			2,468
Gross deferred tax assets	115,686			146,496
Valuation allowance	(103,126		)	(133,477		)
Net deferred tax assets	$	12,560		$	13,019

Liabilities:
Broadcast licenses, trademarks and customer relationships	$	(21,979	)	$	(24,789	)
Property, plant and equipment	(293		)	(166		)
Programming rights	(5,123		)	(6,211		)
Tax payable on potential distribution of reserves	(4,379		)	—
Other	(920		)	(169		)
Total deferred tax liabilities	(32,694		)	(31,335		)
Net deferred income tax liability	$	(20,134	)	$	(18,316	)

Deferred tax is recognized on the consolidated balance sheet as follows:



	December 31, 2018			December 31, 2017
Net non-current deferred tax assets	$	2,411		$	2,964

Net non-current deferred tax liabilities	(22,545		)	(21,280		)

Net deferred income tax liability	$	(20,134	)	$	(18,316	)

We provided a valuation allowance against potential deferred tax assets of US$ 103.1 million and US$ 133.5 million as at December 31, 2018 and 2017, respectively, since it has been determined by management, based on the weight of all available evidence, that it is more likely than not that the benefits associated with these assets will not be realized.

During 2018 and 2017, we had the following movements on valuation allowances:



Balance at December 31, 2016	$	110,920
Created during the period	7,151
Utilized	(909		)
Foreign exchange	15,844
Other	471
Balance at December 31, 2017	133,477
Created during the period	100
Utilized	(26,142		)
Foreign exchange	(5,569		)
Other	1,260
Balance at December 31, 2018	$	103,126

As of December 31, 2018 we had operating loss carry-forwards that will expire in the following periods:



	2019		2020		2021		2022		2023-27		Indefinite
The Netherlands	$	61,379	$	48,606	$	50,975	$	54,706	$	268,451	$	—
Slovenia	—		—		—		—		—		20,136
United Kingdom	—		—		—		—		—		2,063
Total	$	61,379	$	48,606	$	50,975	$	54,706	$	268,451	$	22,199

The losses are subject to examination by the tax authorities and to restriction on their utilization. In particular, the losses can only be utilized against profits arising in the legal entity in which they arose.

We have provided valuation allowances against most of the above loss carry-forwards. However, a valuation allowance has not been provided against US$ 10.7 million of the loss carry-forwards in our main operating company in Slovenia on the basis of future reversals of existing taxable temporary differences and taxable income from future trading.

As at December 31, 2018 and 2017, we had no permanently reinvested earnings in subsidiaries giving rise to a temporary difference.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:



Balance at December 31, 2015	$	—
Increases for tax positions taken during a prior period	766
Increases for tax positions taken during a current period	159
Balance at December 31, 2016	925
Foreign exchange	127
Balance at December 31, 2017	1,052
Settlement	(1,077		)
Foreign exchange	25
Balance at December 31, 2018	$	—

We do not anticipate a material increase or decrease in unrecognized tax benefits within the next 12 months.

Our subsidiaries file income tax returns in the Netherlands and various other tax jurisdictions. As at December 31, 2018, our subsidiaries are generally no longer subject to income tax examinations for years before:



Tax Jurisdiction	Year
Bulgaria	2013
Czech Republic	2013
The Netherlands	2016
Romania	2014
Slovak Republic	2011
Slovenia	2013
United Kingdom	2017

We recognize, when applicable, both accrued interest and penalties related to unrecognized tax benefits in income tax expense in the accompanying consolidated statements of operations and comprehensive income / loss. There were no significant interest or penalties accrued in the years ended December 31, 2018, 2017 and 2016.