10 Income taxes continued
1,031
(47) 4.6%
21 (2.0)%
144
(14)%
(140) 13.6%
Ahold
Annual Report 2011
Groupata glance
Performance
Governance
Notes to the consolidated financial statements continued
Investors
Effective income tax rate on continuing operations
Ahold's effective tax rates in the income statement differed from the statutory income tax rate of the Netherlands of 25.0 percent in
2011 and 25.5 percent in 2010. The following table reconciles these statutory income tax rates with the effective income tax rates in the
income statement:
2011
2010
million
million
Income before income taxes
1,077
Income tax expense at statutory tax rates
Adjustments to arrive at effective income tax rates:
Rate differential (local rates versus the statutory rate of the Netherlands)
Deferred tax income related to recognition of deferred tax assets-net
Deferred tax income due to changes in tax rates
Reserves, (non-)deductibles, and discrete items
(258)
25%
(275) 25.5%
25
4
(25)
(2.3)%
(0.3)%
2.3%
Total income taxes
(271) 25.2%
"Rate differential" indicates the effect of Ahold's taxable income being generated and taxed in jurisdictions where tax rates differ from the
statutory tax rate in the Netherlands. "Reserves, (non-)deductibles and discrete items" include one-time events.
During 2011, a tax benefit of €109 million was recognized, resulting from a release of an income tax contingency reserve related to
financing transactions that occurred prior to 2004.
Income taxes on discontinued operations
Current and deferred income tax related to discontinued operations amounted to a benefit of €7 million in 2011 and an expense of
€3 million in 2010 and has been applied against the result from discontinued operations. Included in the 2011 tax benefit is a €3 million
benefit related to the financial obligations under various lease guarantees that the Company had previously provided to landlords of its
former BI-LO and Bruno's subsidiaries and a €4 million benefit related to Tops. For further information, see Notes 5 and 34.
