Details are as follows:
(in millions of euros) | 2020 | 2019* |
|---|---|---|
| Current tax expense | Current tax expense 2020 (747) | Current tax expense 2019* (1,597) |
| Deferred taxes | Deferred taxes 2020 (198) | Deferred taxes 2019* 65 |
TOTAL | TOTAL 2020 (945) | TOTAL 2019* (1,532) |
* Restated for the impacts of IFRS 5 due to the change in scope of E&P operations (see note 1.4.2).
In 2020, €(604) million of the current tax expenses relates to French companies, and €(143) million relates to other subsidiaries (€(1,519) million and €(78) million respectively in 2019).
| (in millions of euros) | 2020 | 2019(1) |
|---|---|---|
| Income of consolidated companies before tax | Income of consolidated companies before tax20201,293 | Income of consolidated companies before tax2019(1)6,393 |
| Income tax rate applicable to the parent company | Income tax rate applicable to the parent company 202032.02% | Income tax rate applicable to the parent company 2019(1)34.43% |
| Theoretical tax expense | Theoretical tax expense2020(414) | Theoretical tax expense2019(1)(2,201) |
| Differences in tax rate (2) | Differences in tax rate (2)2020(225) | Differences in tax rate (2)2019(1)232 |
| Permanent differences(3) | Permanent differences (3)20206 | Permanent differences (3)2019(1)162 |
| Taxes without basis(4) | Taxes without basis (4)2020(27) | Taxes without basis (4)2019(1)118 |
| Unrecognised deferred tax assets(5) | Unrecognised deferred tax assets (5)2020(288) | Unrecognised deferred tax assets (5)2019(1)156 |
| Other | Other 20203 | Other 2019(1)1 |
| ACTUAL TAX EXPENSE | ACTUAL TAX EXPENSE2020(945) | ACTUAL TAX EXPENSE2019(1)(1,532) |
| EFFECTIVE TAX RATE | EFFECTIVE TAX RATE202073.10% | EFFECTIVE TAX RATE2019(1)23.96% |
(1)Restated for the impacts of IFRS 5 due to the change in scope of E&P operations (see note 1.4.2).
The income tax expense amounts to €(945) million in 2020, corresponding to an effective tax rate of 73.10% (compared to €(1,532) million in 2019, corresponding to an effective tax rate of 23.96%). The €587 million decrease in the Group’s tax expense between 2019 and 2020 essentially reflects the €5,100 million decrease in net income before tax, generating a lower tax charge of €1,633 million; however, the unfavourable Council of State decision issued in December 2020 questioning the tax-deductibility of certain long-term liabilities of EDF SA has an impact of €538 million, including unrecognised tax assets of €(361) million due to the Group’s prudent policy concerning recognition of deferred taxes beyond a 10-year horizon; the unfavourable effect of the increase in the income tax rate from 17% to 19% in the United Kingdom; and the absence of any favourable effect of asset disposals in2020 (after the sales of Alpiq and NnG in 2019).
After elimination of these non-recurring items (principally fair value changes and unrealised gains and losses on financial assets, impairment, the consequences of tax litigation, and the impact of changes in the UK tax rate), the effective current tax rate for 2020 is 19.0%, compared to 18.0% in 2019.
The main factors explaining the difference between the theoretical tax rate and this effective rate are:La différence entre le taux d’impôt théorique et le taux effectif s’explique essentiellement par les éléments suivants :
