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7 Income taxes 2009 2010
  CHF thousands    
1) The revised tax law that came into effect in the canton of Grisons on 1 January 2010 provides for a reduction in the tax rate on earnings. This results in a recognised reversal of deferred tax obligations and a corresponding impact on the effective income tax rate.
2) In 2009 SET, owner of a gas-fired combined-cycle power plant in Teverola near Naples, increased the value of the generation facility by TEUR 22,968 in the statutory single-entity financial statements as a result of the provision in Art. 15 of the 185/2008 law relating to real estate. The provision allows real estate assets to be reappraised at a higher value via equity reserves. Depreciation of the reappraisal is permitted.
3) The Italian IRAP totalled TCHF 1,052 in the previous year and was disclosed in the “Other” category. These taxes are now disclosed separately.
       
  Income taxes charged to the income statement    
  Current income taxes 23,415 30,411
  Deferred income taxes -23,111 -4,864
  Total 304 25,547
       
  Income taxes charged to equity    
  Income taxes on changes in equity -492 268
  Total -492 268
       
  The reconciliation between the actual tax burden and the expected tax charge for the years ending 31 December 2010 and 31 December 2009 is as follows:    
       
  Transitional statement    
  Profit before income taxes 111,785 105,663
  Expected income tax rate 18.9 % 16.7 %
       
  Income taxes at expected tax rate 21,127 17,625
  Tax effect from non – tax – deductible expenses 2,885 1,144
  Tax effect from income taxed at other rates -2,112 9,113
  Tax effect from tax – free income -385 -3,059
  Value adjustment of previously capitalised deferred taxes on tax – loss carryforwards or temporary differences 603  
  Tax losses in the current year for which no deferred tax assets were formed 992 1,469
  Tax losses charged for which no deferred tax assets were formed -57 -2,609
  Tax rate revision - Switzerland1) -7,609 -450
  Tax law revision in Italy2) -11,792 2
  Regional production tax - Italy (IRAP) 3) - 3,786
  Tax burden/relief subsequently recognised for previous years -2,849 -1,948
  Other -499 474
  Income taxes charged to the income statement 304 25,547
       
  Effective income tax rate 0.3% 24.2%
Deferred income taxes by origin of difference 31.12.2009 31.12.2010
CHF thousands    
     
Deferred tax assets    
Property, plant and equipment 2,399 3,123
Other non – current assets 19,134 13,731
Current assets 6,563 3,169
Provisions 401 1,344
Liabilities 35,529 30,974
Loss carryforwards / tax credits 2,336 1,478
Total 66,362 53,819
     
Deferred tax liabilities    
Property, plant and equipment 71,532 63,816
Other non – current assets 2,691 5,199
Current assets 24,777 19,615
Provisions 19,392 17,079
Liabilities 1,971 1,050
Total 120,363 106,759
     
Of which the following are disclosed in the balance sheet as:    
Deferred tax assets -17,191 -14,915
Deferred tax liabilities 71,192 67,854
Net deffered tax liabilities 54,001 52,939

There are no notable additional tax obligations anticipated as a result of dividend payments made to Group companies and associates. The Repower Group does not recognise deferred taxes levied on possible future payments of retained earnings by Group companies, since these are regarded as permanently reinvested.

Tax loss carryforwards

On 31 December 2010, individual Group companies had tax loss carryforwards of TCHF 17,351 (previous year: TCHF 17,629) which they can charge in future periods as taxable profit. Deferred tax assets are recognised only to the extent that it is probable that the tax credits can be realised. On the balance sheet date the Group had unrecognised tax loss carryforwards of TCHF 12,280 (previous year: TCHF 8,066), since the future utilisation of these amounts for tax purposes is not probable. These are due on the following dates:

Unrecognised tax loss carryforwards 31.12.2009 31.12.2010
CHF thousands    
     
Due within 1 year - -
Due in 1 – 3 years 352 36
Due in 3 – 7 years 6,827 4,057
Due after 7 years or no due date 887 8,187
Total 8,066 12,280