TENARIS SA | CIK:0001190723 | 3

  • Filed: 4/30/2018
  • Entity registrant name: TENARIS SA (CIK: 0001190723)
  • Generator: Thunderdome
  • SEC filing page: http://www.sec.gov/Archives/edgar/data/1190723/000117184318003182/0001171843-18-003182-index.htm
  • XBRL Instance: http://www.sec.gov/Archives/edgar/data/1190723/000117184318003182/ts-20171231.xml
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    • ifrs-full:DisclosureOfIncomeTaxExplanatory

    8
    Income tax
     
        Year ended December 31,  
    (all amounts in thousands of U.S. dollars)   2017     2016     2015  
                       
    Current tax    
    184,016
    		      
    174,410
    		      
    164,562
    		  
    Deferred tax    
    (100,432
    		 )    
    (132,969
    		 )    
    79,943
    		  
         
    83,584
    		      
    41,441
    		      
    244,505
    		  
    From discontinued operations    
    (100,720
    		 )    
    (24,339
    		 )    
    (10,121
    		 )
         
    (17,136
    		 )    
    17,102
    		      
    234,384
    		  
     
    The tax on Tenaris’s income before tax differs from the theoretical amount that would arise using the tax rate in each country as follows:
     
        Year ended December 31,  
    (all amounts in thousands of U.S. dollars)   2017     2016     2015  
                       
    Income before income tax    
    427,711
    		      
    34,430
    		      
    140,829
    		  
                             
    Tax calculated at the tax rate in each country (*)    
    6,456
    		      
    (91,628
    		 )    
    (71,588
    		 )
    Non taxable income / Non deductible expenses, net (*)    
    40,298
    		      
    51,062
    		      
    149,632
    		  
    Changes in the tax rates    
    (62,968
    		 )    
    4,720
    		      
    6,436
    		  
    Effect of currency translation on tax base (**)    
    (922
    		 )    
    105,758
    		      
    151,615
    		  
    Accrual / Utilization of previously unrecognized tax losses (***)    
    -
    		      
    (52,810
    		 )    
    (1,711
    		 )
    Tax charge    
    (17,136
    		 )    
    17,102
    		      
    234,384
    		  
     
    (*) Include the effect of the impairment charges of approximately
    $400.3
    million in
    2015.
     
    (**) Tenaris applies the liability method to recognize deferred income tax on temporary differences between the tax basis of assets and their carrying amounts in the financial statements. By application of this method, Tenaris recognizes gains and losses on deferred income tax due to the effect of the change in the value on the tax basis in subsidiaries (mainly Mexico, Argentina and Colombia), which have a functional currency different than their local currency. These gains and losses are required by IFRS even though the revalued / devalued tax basis of the relevant assets will
    not
    result in any deduction / obligation for tax purposes in future periods.
     
    (***)  It includes a deferred tax income of approximately
    $45
    million booked in the last quarter of
    2016
    related to a capital loss. Amount was carried forward in line with US Regulation in force, and offset in
    2017
    Capital Gains.
     
    Changes in the tax rates:
    On
    December 29, 2017
    Argentina enacted amendments to several tax laws, including among others a reduction in the corporate income tax rate from
    35%
    to
    30%
    for fiscal years starting
    1
    January 2018
    to
    31
    December 2019
    and to
    25%
    going forward. The impact booked in the Company income tax charge of the year was a gain of approximately
    $46
    million of deferred tax income.
     
    On
    December 22, 2017
    the U.S. enacted significant changes to U.S. tax law. The reform is complex and considers significant changes to the U.S. corporate income tax system by, among others, reducing the Federal corporate income tax rate from
    35%
    to
    21%.
    The Company has made a reasonable estimate of the financial impacts of the reform. However, given its significant changes and complexities, and considering that more accurate information on the impact and the modalities of its application will be obtained in subsequent reporting periods, certain measurement adjustments could be needed.
     
    The impact booked in the Company income tax charge of the year was a gain of approximately
    $15.2
    million of deferred tax income.
     
    Tax charge
    of the year has been affected by an extraordinary charge related to the settlement agreement with the Italian tax authorities (see Note
    25
    ).