INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2021

The Company’s income tax provision is consisted of the following for the years ended December 31, 2021, 2020 and 2019:

Details	2021			2020			2019
Current tax expense:
Foreign	$	13,504		$	2,232		$	1,013
Deferred tax expense (benefit):
Local		2,518			8,481			7,098
Foreign		(14,998	)		(5,314	)		(5,163	)
Income tax expense:	$	1,024		$	5,399		$	2,948

Schedule of Profit (Loss) Before Taxes

Details	2021			2020			2019
Profit (loss) before taxes:
Domestic	$	166,273		$	100,145		$	103,432
Foreign		(11,174	)		(11,457	)		(12,411	)
Total profit before taxes	$	155,099		$	88,688		$	91,021

Schedule of Deferred Tax Asset/Liability

C. Components of Deferred Tax Asset/Liability

The following is a summary of the components of the deferred tax assets and liabilities reflected in the balance sheets as of the respective dates (*), as of December 31, 2021 and 2020:

Details	2021			2020
Deferred tax asset and liability - long-term:
Deferred tax assets:
Net operating loss carryforward	$	77,586		$	72,658
Employees benefits and compensation		5,366			6,813
Accruals and reserves		7,863			3,312
Research and development		20,633			18,179
Others		3,737			3,453
		115,185			104,415
Valuation allowance, see Note 19F below		(11,644	)		(10,745	)
Deferred tax assets	$	103,541		$	93,670
Deferred tax liabilities - long-term:
Depreciation and amortization	$	(72,678	)	$	(76,136	)
Others		(1,114	)		(1,018	)
Deferred tax liabilities	$	(73,792	)	$	(77,154	)

Presented in long term deferred tax assets	$	53,526		$	57,802
Presented in long term deferred tax liabilities	$	(23,777	)	$	(41,286	)

(*) Deferred tax assets and liabilities relating to Tower for the years 2021 and 2020 are computed based on the Israeli Preferred Enterprise tax rate of 7.5%.

Schedule of Reconciliation of Unrecognized Tax Benefits

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

Details	Unrecognized tax benefits
Balance as of January 1, 2021	$	15,314
Additions for tax positions of current year		624
Reduction due to statute of limitation of prior years		(8,175	)
Balance as of December 31, 2021	$	7,763

Details	Unrecognized tax benefits
Balance as of January 1, 2020	$	15,113
Additions for tax positions of current year		624
Reduction due to statute of limitation of prior years		(423	)
Balance as of December 31, 2020	$	15,314

Details	Unrecognized tax benefits
Balance as of January 1, 2019	$	14,783
Additions for tax positions of current year		778
Reduction due to statute of limitation of prior years		(448	)
Balance as of December 31, 2019	$	15,113

Schedule of Effective Income Tax Rate Reconciliation

The reconciliation of the statutory tax rate to the effective tax rate for the years ended December 31, 2021, 2020 and 2019:

Details	2021			2020			2019
Tax expense computed at statutory rates, see (*) below	$	35,673		$	20,398		$	20,935
Effect of different tax rates in different jurisdictions and Preferred Enterprise Benefit		(24,683	)		(15,046	)		(16,396	)
Change in valuation allowance, see Note 19F below		899			3,479			1,432
Permanent differences and other, net		(10,865	)		(3,432	)		(3,023	)
Income tax expense	$	1,024		$	5,399		$	2,948

(*) The tax expense was computed based on regular Israeli corporate tax rate of 23%.