Income Tax Expense

6 Months Ended

Jun. 30, 2017

Income Tax Disclosure [Abstract]

Income Tax Expense

The effective tax rates for the three months ended June 30, 2017 and 2016 were 15.0% and 3.9%, respectively. The effective tax rates for the six months ended June 30, 2017 and 2016 were 14.6% and 13.8%, respectively. Income tax expense of $4.0 million in the second quarter of 2017increased by $3.3 million compared to $0.7 million in the same period in 2016, due to the result of several items discrete to each quarter, along with changes in activity levels in jurisdictions with differing tax rates. In addition, during the second quarter of 2016, we settled a tax audit covering the years 2010 through 2012 that resulted in the release of reserves for uncertain tax positions in the amount of $0.9 million which contributed to the lower effective tax rate in that quarter.

On March 29, 2017, the Prime Minister of the United Kingdom ("UK") formally notified the European Council of the UK's intention to withdraw from the European Union ("EU") under Article 50 of the Treaty of Lisbon. The UK's formal withdrawal may impact tax exemptions and reliefs on intra-European transactions between our UK affiliates and EU companies. In addition, it may impact transactions between our UK affiliates and non-EU based companies as EU tax treaties may no longer apply to these transactions.

Due to the uncertainty involved in evaluating the effect of the loss of tax exemptions and reliefs, we are unable to estimate the impact of these changes, if any, at this time. We will continue to monitor developments in this area.