Income Taxes

3 Months Ended

Mar. 31, 2023

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The income tax expense increased between quarterly periods from $2.8 billion in 2022 to $2.9 billion in 2023. The company’s income before income tax expense increased $465 million from $9.1 billion in 2022 to $9.5 billion in 2023, primarily due to higher downstream margins partially offset by lower upstream realizations. The company’s effective tax rate remained unchanged between quarterly periods at 31 percent in 2022 and 2023.

Tax positions for Chevron and its subsidiaries and affiliates are subject to income tax audits by many tax jurisdictions throughout the world. For the company’s major tax jurisdictions, examinations of tax returns for certain prior tax years had not been completed as of March 31, 2023. For these jurisdictions, the latest years for which income tax examinations had been finalized were as follows: United States — 2016, Nigeria — 2007, Australia — 2010, Kazakhstan — 2012 and Saudi Arabia — 2016.

The company engages in ongoing discussions with tax authorities regarding the resolution of tax matters in the various jurisdictions. Both the outcomes for these tax matters and the timing of resolution and/or closure of the tax audits are highly uncertain. Given the number of years that still remain subject to examination and the number of matters being examined in the various tax jurisdictions, the company is unable to estimate the range of possible adjustments to the balance of unrecognized tax benefits beyond the next 12 months.