Year 2017

9. Income tax


EUR million

2017

2016

2015

restated

Current tax expense

7.5

4.4

18.3

Taxes for previous years

0.1

-3.8

-0.1

Deferred tax

-0.2

5.7

-11.0

Total

7.4

6.3

7.2

    

Taxes for previous years recognized in 2016 related to tax decision in Finland. Additional information about uncertain tax positions are disclosed in Note 13. Posti Group's deferred taxes 2016 were significantly impacted by cumulative change in revenue recognition for prepaid services.

    

Reconciliation of tax charge at Finnish tax rate (20%)

   

Profit or loss before tax and associates' results

-36.9

29.5

42.3

Income tax at parent company's tax rate of 20%

-7.4

5.9

8.5

Difference in foreign subsidiaries tax rates

-0.4

-0.2

0.1

Non-deductible expenses and other differences

9.4

0.5

1.0

Tax-exempt income

-0.1

-2.5

-4.7

Adjustments in taxes from previous years

0.1

2.4

1.0

Effect of changes of tax rates on deferred tax

-

-

0.0

Unrecognized deferred tax asset on losses for the period

5.3

1.5

4.4

Changes in deferred tax assets for previous years' losses

0.5

-1.3

-3.1

Income tax

7.4

6.3

7.2

    

Effective tax rate

-20.0%

21.5%

17.0%

    

Effective tax rate in 2017 was significantly impacted by non-deductible expenses in taxation. Then largest non-deductible items included impairment loss recognized on OpusCapita's goodwill as well as loss on disposal of OpusCapita's financial accounting outsourcing business. Also provision for onerous leases in Russia, amounting to EUR 18.2 million, had a significant impact on the effective tax rate as no deferred tax was recognized relating to the provision.