Vilmorin & Cie - Annual report 2017-2018

5 ANNUAL REPORT Vilmorin & Cie 167 2017-2018 2.3 - Current taxes The charge of current taxes corresponds to the total taxes on profits owed to the tax authorities for the fiscal year in accordance with the rules and taxation rates in force in different countries. 2.4 - Tax rate applicable The basic rate for income (corporation) tax in France is 33.33% to which an additional contribution must be added (article 235 ter ZC of the French Tax Code). In December 2017, a new law on income (corporation) tax was enacted in France, lowering the basic tax rate on companies in France to 25%, gradually over the coming five years period. This change has resulted in a reassessment of the deferred tax assets and liabilities recognized on June 30, 2018 in the French subsidiaries. In December 2017, a new tax law was enacted in the United States; in particular, this law included a lowering of the American federal rate from 35% to 21%. This change came into effect on December 28, 2017, and modified the amount of current taxes recognized for the fiscal year, and also lead to a reassessment of the deferred tax assets and liabilities on June 30, 2018 in the American subsidiaries. A comparison between the recorded income tax charge and the theoretical income tax charge is as follows: As a % 17-18 16-17 Theoretical tax rate in France 34.43 34.43 Impact of partnerships (using the equity method) -6.00 -6.44 Differences between the tax rates applied in France and other countries -6.41 -5.61 Other permanent differences -2.80 12.15 Impact of dividend distributions 9.21 7.35 Adjustments of taxes and taxes with no base -18.40 -5.45 Unrecognized losses 14.35 10.63 Temporary differences -0.61 -3.37 Impact of capital gains and losses from disposals and asset value losses -4.02 -11.14 Impact from the variations in the deferred taxes rate in France and the USA -12.01 - Effective tax rate 7.74 32.56 2.5 - Details of tax receivables and debts due In millions of euros 17-18 16-17 Tax receivables due 54.5 51.1 Tax debts due -12.2 -12.2 Total net 42.3 38.9 2.6 - Information on tax losses On June 30, 2018, Vilmorin & Cie held a total of 226.4 million euros of tax losses. The group is required to recognize deferred tax assets on usable losses to be carried forward, bearing in mind their recoverability, on the basis of the outlook for its results. On June 30, 2018, the amount of tax losses activated on losses carried forward amounted to 75.8 million euros, representing deferred tax assets of 21.7 million euros. 5.1. Consolidated Financial Statements Financial INFORMATION