Income Taxes

At the end of each interim reporting period, the Company makes an estimate of its annual effective income tax rate. Tax expense in interim periods is calculated at the estimated annual effective tax rate plus or minus the tax effects of items of income and expense that are discrete to the period. The estimate used in providing for income taxes on a year-to-date basis may change in subsequent interim periods.

The following table provides details of income taxes:



	Three Months Ended						Six Months Ended
	July 1, 2017			July 2, 2016			July 1, 2017			July 2, 2016
Net earnings before income taxes	$	205		$	167		$	324		$	189
Income tax expense	73			59			114			64
Effective tax rate	36		%	35		%	35		%	34		%

The Company recorded $73 million of net tax expense during the three months ended July 1, 2017, resulting in an effective tax rate of 36%, compared to $59 million of net tax expense during the three months ended July 2, 2016, resulting in an effective tax rate of 35%. The effective tax rate in the second quarter of 2017 was greater than the U.S. statutory tax rate of 35% partly due to change of estimates between provision and the filing of tax returns in foreign jurisdictions. The effective tax rate in the second quarter of 2016 was equal to the U.S. statutory tax rate of 35%.

The Company recorded $114 million of net tax expense during the six months ended July 1, 2017, resulting in an effective tax rate of 35%, compared to $64 million of net tax expense during the six months ended July 2, 2016, resulting in an effective tax rate of 34%. The effective tax rate in the first half of 2017 was equal to the U.S. statutory tax rate of 35%. The effective tax rate in the first half of 2016 was lower than the U.S. statutory tax rate of 35% partly due to the recognition of excess tax benefits on share-based compensation.