Income Taxes

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company's effective tax rate for the first quarter of 2021 was 28.1% compared with 31.5% in the first quarter of 2020 and 37.6% for the full year 2020. The decrease in the first quarter of 2021 effective tax rate from the full year 2020 rate is primarily due to an increase in projected earnings in jurisdictions with lower tax rates, a reduction in tax reserves due to statute of limitations expiration and the absence of tax expense related to the completed sale of the Seeger business in the first quarter of 2020. The tax rate benefits were partially offset by additional expense related to the global intangible low-tax income tax.

The Aerospace and Industrial segments have a number of multi-year tax holidays in Singapore and China. The tax holiday in China expired at the end of 2020. The Company has re-applied for approval of a potential three-year holiday in China which could reduce the tax rate. The Company anticipates notification of a decision on its application for the holiday in the latter half of 2021. These holidays are subject to the Company meeting certain commitments in the respective jurisdictions. Aerospace was granted an income tax holiday for operations recently established in Malaysia. This holiday commenced effective November 2020 and remains effective for a period of ten years from inception.