Income Taxes

3 Months Ended

Jun. 30, 2019

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

The Company operates in the United States and many foreign countries and is subject to the tax laws of many jurisdictions. Changes in tax laws or the interpretation of tax laws can affect the Company’s earnings, as can the resolution of pending and contested tax issues. The Company's consolidated effective income tax rate is affected by a number of factors, including the mix of domestic and foreign earnings and the effect of exchange rate changes on deferred taxes. Effective tax rates also reflect the benefit of various tax planning opportunities, as well as the net effect of items that were accounted for on a discrete basis in each period.

For the three months ended June 30, 2019, the Company's consolidated effective income tax rate of 83% was affected by a $2.8 million net tax provision related to an unresolved tax matter at a foreign subsidiary.  Without the discrete item for the unresolved tax matter, income taxes for the quarter would have been an expense of approximately $1.5 million, or a consolidated effective income tax rate of approximately 29%.

For the three months ended June 30, 2018, the Company reported a net tax benefit on pretax earnings due to a benefit from reversing a portion of the liability previously recorded for dividend withholding taxes on the cumulative retained earnings of a foreign subsidiary. The reversal followed the resolution of uncertainties with the local country taxing authorities with respect to the inclusion of the tax under a tax holiday applicable to the subsidiary and was attributable to the portion of cumulative retained earnings that the Company expects to distribute prior to the expiration of the holiday. Without the dividend withholding tax reversal, income taxes for the quarter would have been an expense of approximately $1.5 million, or a consolidated effective tax rate of approximately 27%.