Income taxes, broken down into current and deferred income taxes, are as follows:

Income Taxes  

in € millions20162015
Earnings before income taxes (total)1,5561,454
Current income taxes from continuing operations(388)(287)
Deferred income taxes from continuing operations(31)(59)
Income taxes from continuing operations(419)(346)
Current income taxes from discontinued operations
Deferred income taxes from discontinued operations
Income taxes from discontinued operations
 
Total income taxes(419)(346)
Net income after income taxes (total)1,1371,108

Tax loss carryforwards of €433 million (previous year: €446 million) were utilized in the financial year 2016, reducing current tax expenses by €102 million (previous year: €104 million). Of the tax loss carryforwards utilized, €132 million (previous year: €172 million) was due to German corporate income tax, €41 million (previous year: €25 million) was due to German trade tax and €260 million (previous year: €249 million) was due to foreign income taxes. These amounts include €40 million (previous year: €88 million) for tax loss carryforwards for which no deferred tax assets were recognized in the past. These relate to German corporate tax in the amount of €1 million (previous year: €1 million), German trade tax in the amount of €1 million (previous year: €5 million) and foreign income taxes in the amount of €38 million (previous year: €82 million). This led to a reduction in current tax expense of €11 million (previous year: €24 million).

Deferred tax assets and liabilities resulted from the following items and factors:

Deferred Taxes  

 12/31/201612/31/2015
in € millionsAssetsEquity and
liabilities
thereof
recognized
in profit or
loss
AssetsEquity and
liabilities
thereof
recognized
in profit or
loss
Intangible assets276570(4)30156911
Property, plant and equipment63391064469
Financial assets142675217
Inventories754(7)804(11)
Receivables11124(11)123257
Advance payments and other assets11315317118165(46)
Provisions826182(5)77624012
Financial debt1942(13)2232(13)
Liabilities29491931
Advance payments and other liabilities553155440(4)
Loss carryforwards/tax credits355(39)384(32)
Total1,9361,075(31)1,9461,145(59)
Offset(929)(929)(985)(985)
Carrying amount1,007146961160

No deferred tax liabilities were recognized for temporary differences in connection with investments in subsidiaries in the amount of €781 million (previous year: €657 million) as Bertelsmann can control their reversal, and it is probable that these temporary differences will not be reversed in the foreseeable future. Current and deferred tax assets and liabilities are offset against each other if they relate to the same tax authority and meet the criteria for offsetting. The term of the deferred taxes on temporary differences is mostly long term.

Information on amounts of income tax relating to other comprehensive income is presented in section 18 “Equity”.

Valuation allowances for deferred tax assets are recognized on temporary differences, tax loss carryforwards and tax credits when it is unlikely that they can be utilized in the foreseeable future. The need to recognize valuation allowances is assessed primarily based on existing deferred tax liabilities from temporary differences and projected taxable income within a planning period.

Temporary differences, tax loss carryforwards and tax credits for which no deferred taxes have been recognized can be carried forward as follows:

Expiration  

in € millions12/31/201612/31/2015
Tax loss carryforwards
To be carried forward for more than 5 years6,4886,733
To be carried forward for up to 5 years126131
Temporary differences91121
Tax credits
To be carried forward for more than 5 years5068
To be carried forward for up to 5 years13

A reconciliation of expected tax result to actual tax result is shown in the following table:

Reconciliation to Actual Tax Expense  

in € millions20162015
Earnings before income taxes from continuing operations1,5551,451
Income tax rate applicable to Bertelsmann SE & Co. KGaA30.80%30.70%
Expected tax expense from continuing operations(479)(445)
The tax effects of the following items led to differences between the expected and actual tax expense:
Adjustment to different national tax rates(8)(23)
Effect of changes in tax rate and tax law(4)5
Tax effects in respect of results from disposals of investments5(6)
Current income taxes for previous years1122
Deferred income taxes for previous years1355
Effects of measurements of deferred tax assets484
Permanent differences1351
Other adjustments(18)(9)
Total of adjustments6099
Actual tax expense from continuing operations(419)(346)

The income tax rate applicable to Bertelsmann SE & Co. KGaA consists of corporate income tax, the solidarity surcharge and trade tax.

Effective Income Tax Rate  

20162015
Corporate income tax including solidarity surcharge15.83 %15.83 %
Trade tax14.97 %14.87 %
Effective income tax rate30.80 %30.70 %