12. Income Taxes

A reconciliation of the US statutory federal tax rate (35%) to the consolidated effective income tax rate follows:

	Nine Months
	2016			2015
US federal statutory rate		35	%		35	%
State tax		2			-
Non-US income taxed at different rates		(22	)		(12	)
Charges and credits (See Note 2)		(1	)		1
Other		1			(2	)
		15	%		22	%

The components of net deferred tax assets (liabilities) were as follows:

(Stated in millions)

	Sept. 30,			Dec. 31,
	2016			2015
Postretirement benefits	$	260		$	266
Intangible assets		(3,171	)		(1,418	)
Investments in non-US subsidiaries		(149	)		(152	)
Fixed assets, net		(150	)		(176	)
Inventories		262			159
Other, net		717			454
	$	(2,231	)	$	(867	)

The above deferred tax balances at September 30, 2016 and December 31, 2015 were net of valuation allowances relating to net operating losses in certain countries of $170 million and $162 million, respectively.