Consolidated
       Parent Entity
2006
$000
2005
$000
2006
$000
2005
$000
       

(a) Recognised in the income statements

Current tax expense:
Current year
179,759
246,358
4,113
1,940
Adjustments for prior years
(2,341)
(12,935)
 –
177,418
233,423
4,113
1,940
Deferred tax expense:
Origination and reversal of temporary differences
17,250
(40,342)
(287)
Total income tax expense in the income statements
194,668
193,081
3,826
1,940
         

(b) Numerical reconciliation between income tax expense and profit before income tax expense

Profit before income tax expense
661,865
788,034
129,417
45,967
Income tax using the domestic corporate tax rate of 30% (2005: 30%)
198,559
236,410
38,825
13,790
Increase in income tax expense due to:
     Imputation gross-up on dividends received
1,106
855
 –
     Impairment of goodwill
68
 –
 –
     Net tangible capital gains tax
610
2,171
 –
     Other
 –
 –
312
Decrease in income tax expense due to:
     Share of net profit of associated entities
(1,535)
(1,380)
 –
     Research and development allowances
(375)
(375)
 –
     Depreciable repairs and maintenance
 –
(2,008)
     Origination of temporary differences
 –
(7,680)
 –
     Dividends received from subsidiaries
 –
 –
(35,311)
(11,850)
     Other
(1,079)
(1,006)
 –
     Franking credits on dividends received
(345)
(117)
 –
Income tax expense on the profit before income tax expense
before individually material income tax items
197,009
226,870
3,826
1,940
Individually material income tax items:
     Net deferred tax balances recognised upon implementation of tax consolidation
 –
(20,854)
 –
197,009
206,016
3,826
1,940
Income tax over-provided in prior years
(2,341)
(12,935)
 –
Total income tax expense in the income statements
194,668
193,081
3,826
1,940
         

(c) Deferred tax recognised directly in equity

Related to actuarial gains
(3,195)
(2,765)
 –
Related to financial instruments
(175)
(6)
 –
(3,370)
(2,771)
 –

 

(d) Recognised deferred tax assets and liabilities

Deferred tax assets and liabilities are attributable to the following:
 
          Assets
           Liabilities
           Net
Consolidated
2006
$000
2005
$000
2006
$000
2005
$000
2006
$000
2005
$000
Receivables
3,327
1,668
 –
 –
3,327
1,668
Inventories
 –
 –
(2,229)
(914)
(2,229)
(914)
Property, plant and equipment and intangibles
 –
 –
(82,231)
(77,390)
(82,231)
(77,390)
Payables
6,793
23,313
 –
 –
6,793
23,313
Interest bearing liabilities
2,689
2,876
 –
 –
2,689
2,876
Provisions
45,021
41,349
 –
 –
45,021
41,349
Other
 –
 –
(4,032)
(944)
(4,032)
(944)
Net tax assets/(liabilities)
57,830
69,206
(88,492)
(79,248)
(30,662)
(10,042)
             
Parent Entity
Provisions
73
131
 –
 –
73
131
Interest bearing liabilities
345
 –
 –
 –
345
Net tax assets
418
131
 –
 –
418
131

 

(e) Unrecognised deferred tax assets

Deferred tax assets have not been recognised in both the consolidated entity and parent entity in respect to the following items.
2006
$000
2005
$000
       
Tax losses
195,704
197,744
       
Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which these benefits can be utilised by the Group.

 

(f) Movement in temporary differences during the year

Balance at
Recognised
Recognised
Balance at
1-Jan-06
in income
in equity
31-Dec-06
Consolidated
$000
$000
$000
$000
Receivables
1,668
1,659
 –
3,327
Inventories
(914)
(1,315)
 –
(2,229)
Property, plant and equipment
(77,390)
(4,841)
 –
(82,231)
Payables
23,313
(16,520)
 –
6,793
Interest bearing liabilities
2,876
(12)
(175)
2,689
Provisions
41,349
3,958
(286)
45,021
Other
(944)
(179)
(2,909)
(4,032)
(10,042)
(17,250)
(3,370)
(30,662)
Balance at
Recognised
Recognised
Balance at
1-Jan-05
in income
in equity
31-Dec-05
Consolidated
$000
$000
$000
$000
Receivables
2,388
(720)
 –
1,668
Inventories
(1,442)
528
 –
(914)
Property, plant and equipment
(101,095)
23,705
 –
(77,390)
Payables
16,228
7,085
 –
23,313
Interest bearing liabilities
2,637
245
(6)
2,876
Provisions
33,850
10,264
(2,765)
41,349
Other
(179)
(765)
 –
(944)
(47,613)
40,342
(2,771)
(10,042)
Balance at
Recognised
Recognised
Balance at
1-Jan-06
in income
in equity
31-Dec-06
Parent Entity
$000
$000
$000
$000
Interest bearing liabilities
345
 –
345
Provisions
131
(58)
 –
73
131
287
 –
418
Balance at
Recognised
Recognised
Balance at
1-Jan-05
in income
in equity
31-Dec-05
Parent Entity
$000
$000
$000
$000
Interest bearing liabilities
 –
 –
 –
Provisions
131
 –
 –
131
131
 –
 –
131

 

(g) Individually material tax item in 2005

Following the passing of Tax Law Amendment Bill (2004 Measures No. 6) by the Senate in early 2005, allowable depreciable deductions of $69,513,000 are available to Caltex. This resulted in a reduction of $20,854,000 in the deferred tax liability and income tax expense for the year ended 31 December 2005.