Note 4 – Income taxes

2015 Compared to U.S. Statutory Rate

The effective income tax rate on continuing operations in the first quarter of 2015 was higher than the 35% U.S. statutory tax rate, primarily due to the significant nondeductible expenses resulting from the currency devaluation in Venezuela in the first quarter. 

Excluding the Venezuela nondeductible expenses and the associated tax implications, our effective tax rate on continuing operations in the first quarter is 54%.  The rate is higher than 35% primarily due to higher tax expense resulting from cross border payments, nondeductible expenses in Mexico and the characterization of a French business tax as an income tax, partially offset by lower taxes resulting from the geographical mix of earnings.

2014 Compared to U.S. Statutory Rate

The effective income tax rate on continuing operations in the first quarter of 2014 was negative when compared to the 35% U.S. statutory tax rate, primarily due to the significant nondeductible remeasurement charge resulting from the currency devaluation in Venezuela in the first quarter.  This remeasurement charge caused our first quarter before tax earnings to be negative and is largely nondeductible for tax purposes.  Excluding the aforementioned Venezuela remeasurement charge and associated tax implications, our effective tax rate on continuing operations in the first quarter was 37%.