INCOME TAXES

The calculation of the effective tax rate is as follows (in thousands):



	Three months ended March 31,						Six months ended March 31,
	2018			2017			2018			2017
Loss before income taxes	$	(5,090	)	$	(2,174	)	$	(11,823	)	$	(3,914	)

Income tax benefit	(1,760		)	(1,345		)	(2,831		)	(2,786		)

Net loss	$	(3,330	)	$	(829	)	$	(8,992	)	$	(1,128	)

Effective tax rate	35		%	62		%	24		%	71		%

In the second quarter of Fiscal 2018, the effective tax rate was impacted by the relative amounts of income/loss recognized in various jurisdictions as well as a deferred tax expense due to the remeasurement of our U.S. deferred tax assets, which are not expected to be realized prior to the end of Fiscal 2018 and a foreign tax loss which is reserved with a valuation allowance. On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act (the Act). The Act lowers the corporate tax rate from 35% to 21% effective January 1, 2018. As a result, the U.S. federal statutory rate for Fiscal 2018 is a reduced blended U.S. tax rate of 24.5%. The final impact of the Act may differ from our estimates based on changes in interpretations or assumptions we make, as well as the issuance of additional guidance. The effective tax rate for the second quarter of Fiscal 2017 was favorably impacted by the lower tax rate in the United Kingdom, the relative amounts of income/loss recognized in various jurisdictions, as well as the utilization of net operating loss carryforwards in Canada that are fully reserved with a valuation allowance.

The effective tax rate for the six months ended March 31, 2018 was favorably impacted due to the lower corporate tax rate for C corporations under the Act, but was partially offset by deferred tax expense of $0.8 million due to the re-measurement of our U.S. deferred tax assets, which are not expected to be realized prior to the end of Fiscal 2018. The effective tax rate for the six months ended March 31, 2017 was favorably impacted by a discrete item relating to the close of an IRS audit recorded during the first quarter of Fiscal 2017 due to the release of a $0.3 million FIN 48 reserve relating to the R&D Tax Credit. Additionally, the effective tax rate for the six months ended March 31, 2017 was impacted by the lower tax rate in the United Kingdom, the relative amounts of income/loss recognized in various jurisdictions, as well as the utilization of net operating loss carryforwards in Canada that are fully reserved with a valuation allowance.