INCOME TAXES (Tables)
|
12 Months Ended |
Dec. 31, 2019 |
Income Tax |
|
Schedule of income tax expense (benefit) |
The following is a summary of U.S. and non-U.S. provisions for current and deferred income taxes (dollars in millions):
Huntsman Corporation
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2019 |
|
2018 |
|
2017 |
Income tax (benefit) expense: |
|
|
|
|
|
|
|
|
|
U.S. |
|
|
|
|
|
|
|
|
|
Current |
|
$ |
(17) |
|
$ |
57 |
|
$ |
23 |
Deferred |
|
|
(181) |
|
|
(30) |
|
|
(133) |
Non-U.S. |
|
|
|
|
|
|
|
|
|
Current |
|
|
71 |
|
|
153 |
|
|
88 |
Deferred |
|
|
89 |
|
|
(135) |
|
|
42 |
Total |
|
$ |
(38) |
|
$ |
45 |
|
$ |
20 |
|
Schedule of reconciliation of the differences between the U.S. federal income taxes at the U.S. statutory rate to total provision for income taxes |
The following schedule reconciles the differences between the U.S. federal income taxes at the U.S. statutory rate to our provision for income taxes (dollars in millions):
Huntsman Corporation
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2019 |
|
2018 |
|
2017 |
Income from continuing operations before income taxes |
|
$ |
391 |
|
$ |
734 |
|
$ |
531 |
Expected tax expense at U.S. statutory rate of 21%, 21% and 35%, respectively |
|
$ |
82 |
|
$ |
154 |
|
$ |
186 |
Change resulting from: |
|
|
|
|
|
|
|
|
|
State tax expense net of federal benefit |
|
|
(3) |
|
|
(1) |
|
|
(2) |
Non-U.S. tax rate differentials |
|
|
9 |
|
|
27 |
|
|
(67) |
U.S. Tax Reform Act impact |
|
|
(1) |
|
|
32 |
|
|
(52) |
Currency exchange gains/losses(net) |
|
|
(5) |
|
|
(10) |
|
|
15 |
Venator investment basis difference and fair market value adjustments |
|
|
(199) |
|
|
18 |
|
|
— |
Tax losses related to Venator investment |
|
|
(18) |
|
|
— |
|
|
— |
Non-U.S. income subject to U.S. tax not offset by U.S. foreign tax credits |
|
|
7 |
|
|
16 |
|
|
— |
Tax authority audits and dispute resolutions |
|
|
(6) |
|
|
5 |
|
|
9 |
Share-based compensation excess tax benefits |
|
|
(4) |
|
|
(14) |
|
|
(10) |
Change in valuation allowance |
|
|
56 |
|
|
(185) |
|
|
(72) |
Deferred tax effects of non-U.S. tax rate changes |
|
|
36 |
|
|
(2) |
|
|
4 |
Impact of equity method investments |
|
|
(13) |
|
|
(14) |
|
|
(3) |
Other non-U.S. tax effects, including nondeductible expenses transfer pricing adjustments and various withholding taxes |
|
|
19 |
|
|
19 |
|
|
3 |
Other U.S. tax effects, including nondeductible expenses and other credits |
|
|
2 |
|
|
— |
|
|
9 |
Total income tax (benefit) expense |
|
$ |
(38) |
|
$ |
45 |
|
$ |
20 |
|
Schedule of components of income (loss) from continuing operations before income taxes |
The components of income (loss) from continuing operations before income taxes were as follows (dollars in millions):
Huntsman Corporation
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2019 |
|
2018 |
|
2017 |
U.S. |
|
$ |
(106) |
|
$ |
(38) |
|
$ |
(143) |
Non-U.S. |
|
|
497 |
|
|
772 |
|
|
674 |
Total |
|
$ |
391 |
|
$ |
734 |
|
$ |
531 |
|
Schedule of components of deferred income tax assets and liabilities |
Components of deferred income tax assets and liabilities were as follows (dollars in millions):
Huntsman Corporation
|
|
|
|
|
|
|
|
|
December 31, |
|
|
2019 |
|
2018 |
Deferred income tax assets: |
|
|
|
|
|
|
Net operating loss carryforwards |
|
$ |
281 |
|
$ |
359 |
Pension and other employee compensation |
|
|
172 |
|
|
180 |
Property, plant and equipment |
|
|
15 |
|
|
15 |
Intangible assets |
|
|
56 |
|
|
76 |
Basis difference in Venator investment |
|
|
199 |
|
|
— |
Operating leases |
|
|
98 |
|
|
— |
Other, net |
|
|
72 |
|
|
50 |
Total |
|
$ |
893 |
|
$ |
680 |
Deferred income tax liabilities: |
|
|
|
|
|
|
Property, plant and equipment |
|
$ |
(218) |
|
$ |
(199) |
Pension and other employee compensation |
|
|
(1) |
|
|
— |
Intangible assets |
|
|
(27) |
|
|
(33) |
Unrealized currency gains |
|
|
(43) |
|
|
(37) |
Operating leases |
|
|
(102) |
|
|
— |
Other, net |
|
|
(8) |
|
|
(9) |
Total |
|
$ |
(399) |
|
$ |
(278) |
Net deferred tax asset before valuation allowance |
|
$ |
494 |
|
$ |
402 |
Valuation allowance—net operating losses and other |
|
|
(231) |
|
|
(215) |
Net deferred tax asset |
|
$ |
263 |
|
$ |
187 |
Non-current deferred tax asset |
|
|
292 |
|
|
324 |
Non-current deferred tax liability |
|
|
(29) |
|
|
(137) |
Net deferred tax asset |
|
$ |
263 |
|
$ |
187 |
|
Schedule of changes in valuation allowance |
The following is a summary of changes in the valuation allowance (dollars in millions):
Huntsman Corporation
|
|
|
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
2017 |
Valuation allowance as of January 1 |
|
$ |
215 |
|
$ |
412 |
|
$ |
484 |
Valuation allowance as of December 31 |
|
|
231 |
|
|
215 |
|
|
412 |
Net (increase) decrease |
|
|
(16) |
|
|
197 |
|
|
72 |
Foreign currency movements |
|
|
— |
|
|
3 |
|
|
11 |
(Decrease) increase to deferred tax assets with no impact on operating tax expense, including an offsetting (decrease) increase to valuation allowances |
|
|
(40) |
|
|
(15) |
|
|
(11) |
Change in valuation allowance per rate reconciliation |
|
$ |
(56) |
|
$ |
185 |
|
$ |
72 |
Components of change in valuation allowance affecting tax expense: |
|
|
|
|
|
|
|
|
|
Pre-tax income and losses in jurisdictions with valuation allowances resulting in no tax expense or benefit |
|
$ |
(133) |
|
$ |
53 |
|
$ |
50 |
Releases of valuation allowances in various jurisdictions |
|
|
— |
|
|
132 |
|
|
22 |
Establishments of valuation allowances in various jurisdictions |
|
|
77 |
|
|
— |
|
|
— |
Change in valuation allowance per rate reconciliation |
|
$ |
(56) |
|
$ |
185 |
|
$ |
72 |
|
Schedule of reconciliation of unrecognized tax benefits |
The following is a reconciliation of our unrecognized tax benefits (dollars in millions):
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
Unrecognized tax benefits as of January 1 |
|
$ |
26 |
|
$ |
23 |
Gross increases and decreases—tax positions taken during a prior period |
|
|
4 |
|
|
1 |
Gross increases and decreases—tax positions taken during the current period |
|
|
1 |
|
|
3 |
Decreases related to settlements of amounts due to tax authorities |
|
|
— |
|
|
— |
Reductions resulting from the lapse of statutes of limitation |
|
|
(4) |
|
|
— |
Foreign currency movements |
|
|
1 |
|
|
(1) |
Unrecognized tax benefits as of December 31 |
|
$ |
28 |
|
$ |
26 |
|
Schedule of interest and penalties accrued related to unrecognized tax benefits included in the income tax expense |
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2019 |
|
2018 |
|
2017 |
Interest expense included in tax expense |
|
$ |
2 |
|
$ |
— |
|
$ |
— |
Penalties expense included in tax expense |
|
|
2 |
|
|
— |
|
|
— |
|
|
|
|
|
|
|
|
|
December 31, |
|
|
2019 |
|
2018 |
Accrued liability for interest |
|
$ |
5 |
|
$ |
3 |
Accrued liability for penalties |
|
|
2 |
|
|
— |
|
Summary of the tax years that remain subject to examination by major tax jurisdictions |
|
|
|
Tax Jurisdiction |
|
Open Tax Years |
Belgium |
|
2017 and later |
China |
|
2009 and later |
Germany |
|
2014 and later |
Hong Kong |
|
2013 and later |
India |
|
2004 and later |
Italy |
|
2015 and later |
Mexico |
|
2014 and later |
Switzerland |
|
2013 and later |
The Netherlands |
|
2016 and later |
Thailand |
|
2012 and later |
United Kingdom |
|
2017 and later |
United States federal |
|
2017 and later |
|
HUNTSMAN INTERNATIONAL LLC AND SUBSIDIARIES |
|
Income Tax |
|
Schedule of income tax expense (benefit) |
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2019 |
|
2018 |
|
2017 |
Income tax (benefit) expense: |
|
|
|
|
|
|
|
|
|
U.S. |
|
|
|
|
|
|
|
|
|
Current |
|
$ |
(21) |
|
$ |
57 |
|
$ |
16 |
Deferred |
|
|
(179) |
|
|
(34) |
|
|
(130) |
Non-U.S. |
|
|
|
|
|
|
|
|
|
Current |
|
|
70 |
|
|
153 |
|
|
88 |
Deferred |
|
|
89 |
|
|
(135) |
|
|
43 |
Total |
|
$ |
(41) |
|
$ |
41 |
|
$ |
17 |
|
Schedule of reconciliation of the differences between the U.S. federal income taxes at the U.S. statutory rate to total provision for income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2019 |
|
2018 |
|
2017 |
Income from continuing operations before income taxes |
|
$ |
377 |
|
$ |
716 |
|
$ |
524 |
Expected tax expense at U.S. statutory rate of 21%, 21% and 35%, respectively |
|
$ |
79 |
|
$ |
150 |
|
$ |
183 |
Change resulting from: |
|
|
|
|
|
|
|
|
|
State tax expense net of federal benefit |
|
|
(3) |
|
|
(1) |
|
|
(2) |
Non-U.S. tax rate differentials |
|
|
9 |
|
|
27 |
|
|
(67) |
U.S. Tax Reform Act impact |
|
|
(1) |
|
|
32 |
|
|
(53) |
Currency exchange gains/losses(net) |
|
|
(5) |
|
|
(10) |
|
|
15 |
Venator investment basis difference and fair market value adjustments |
|
|
(199) |
|
|
18 |
|
|
— |
Tax losses related to Venator investment |
|
|
(18) |
|
|
— |
|
|
— |
Non-U.S. income subject to U.S. tax not offset by U.S. foreign tax credits |
|
|
7 |
|
|
16 |
|
|
— |
Tax authority audits and dispute resolutions |
|
|
(6) |
|
|
5 |
|
|
9 |
Share-based compensation excess tax benefits |
|
|
(4) |
|
|
(14) |
|
|
(10) |
Change in valuation allowance |
|
|
56 |
|
|
(185) |
|
|
(72) |
Deferred tax effects of non-U.S. tax rate changes |
|
|
36 |
|
|
(2) |
|
|
4 |
Impact of equity method investments |
|
|
(13) |
|
|
(14) |
|
|
(3) |
Other non-U.S. tax effects, including nondeductible expenses transfer pricing adjustments and various withholding taxes |
|
|
19 |
|
|
19 |
|
|
4 |
Other U.S. tax effects, including nondeductible expenses and other credits |
|
|
2 |
|
|
— |
|
|
9 |
Total income tax (benefit) expense |
|
$ |
(41) |
|
$ |
41 |
|
$ |
17 |
|
Schedule of components of income (loss) from continuing operations before income taxes |
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31, |
|
|
2019 |
|
2018 |
|
2017 |
U.S. |
|
$ |
(120) |
|
$ |
(56) |
|
$ |
(150) |
Non-U.S. |
|
|
497 |
|
|
772 |
|
|
674 |
Total |
|
$ |
377 |
|
$ |
716 |
|
$ |
524 |
|
Schedule of components of deferred income tax assets and liabilities |
|
|
|
|
|
|
|
|
|
December 31, |
|
|
2019 |
|
2018 |
Deferred income tax assets: |
|
|
|
|
|
|
Net operating loss carryforwards |
|
$ |
281 |
|
$ |
359 |
Pension and other employee compensation |
|
|
172 |
|
|
180 |
Property, plant and equipment |
|
|
15 |
|
|
15 |
Intangible assets |
|
|
56 |
|
|
76 |
Basis difference in Venator investment |
|
|
199 |
|
|
— |
Operating leases |
|
|
98 |
|
|
— |
Other, net |
|
|
72 |
|
|
50 |
Total |
|
$ |
893 |
|
$ |
680 |
Deferred income tax liabilities: |
|
|
|
|
|
|
Property, plant and equipment |
|
$ |
(218) |
|
$ |
(199) |
Pension and other employee compensation |
|
|
(1) |
|
|
— |
Intangible assets |
|
|
(27) |
|
|
(33) |
Unrealized currency gains |
|
|
(43) |
|
|
(37) |
Operating leases |
|
|
(102) |
|
|
— |
Other, net |
|
|
(8) |
|
|
(7) |
Total |
|
$ |
(399) |
|
$ |
(276) |
Net deferred tax asset before valuation allowance |
|
$ |
494 |
|
$ |
404 |
Valuation allowance—net operating losses and other |
|
|
(231) |
|
|
(215) |
Net deferred tax asset |
|
$ |
263 |
|
$ |
189 |
Non-current deferred tax asset |
|
|
292 |
|
|
324 |
Non-current deferred tax liability |
|
|
(29) |
|
|
(135) |
Net deferred tax asset |
|
$ |
263 |
|
$ |
189 |
|
Schedule of changes in valuation allowance |
|
|
|
|
|
|
|
|
|
|
|
|
2019 |
|
2018 |
|
2017 |
Valuation allowance as of January 1 |
|
$ |
215 |
|
$ |
412 |
|
$ |
487 |
Valuation allowance as of December 31 |
|
|
231 |
|
|
215 |
|
|
412 |
Net (increase) decrease |
|
|
(16) |
|
|
197 |
|
|
75 |
Foreign currency movements |
|
|
— |
|
|
3 |
|
|
11 |
(Decrease) increase to deferred tax assets with no impact on operating tax expense, including an offsetting (decrease) increase to valuation allowances |
|
|
(40) |
|
|
(15) |
|
|
(14) |
Change in valuation allowance per rate reconciliation |
|
$ |
(56) |
|
$ |
185 |
|
$ |
72 |
Components of change in valuation allowance affecting tax expense: |
|
|
|
|
|
|
|
|
|
Pre-tax income and losses in jurisdictions with valuation allowances resulting in no tax expense or benefit |
|
$ |
(133) |
|
$ |
53 |
|
$ |
49 |
Releases of valuation allowances in various jurisdictions |
|
|
— |
|
|
132 |
|
|
23 |
Establishments of valuation allowances in various jurisdictions |
|
|
77 |
|
|
— |
|
|
— |
Change in valuation allowance per rate reconciliation |
|
$ |
(56) |
|
$ |
185 |
|
$ |
72 |
|