6. INCOME TAXES The following table reconciles income taxes at the Corporation’s domestic statutory tax rate of 26.5% in 2025 (26.5% in 2024 and 2023) with income taxes in the consolidated statements of income: | | | | | | | | | | | | 2025 | | 2024 | | 2023 | Income taxes at domestic statutory tax rate | | $ | 337.7 | | $ | 287.2 | | $ | 274.3 | (Reduction) increase resulting from: | | | | | | | | | | Non-deductible charges and non-taxable income | | | (8.8) | | | (3.1) | | | 0.1 | Tax consolidation transactions (note 25) | | | (29.1) | | | (26.9) | | | (33.8) | Other | | | 2.2 | | | (1.8) | | | (2.9) | Income taxes | | $ | 302.0 | | $ | 255.4 | | $ | 237.7 |
6. INCOME TAXES (continued) The significant items comprising the Corporation’s net deferred income tax liability and their impact on the deferred income tax expense are as follows: | | | | | | | | | | | | | | | | | | Consolidated | | Consolidated | | | balance sheets | | income statements | | | 2025 | | 2024 | | 2025 | | 2024 | | 2023 | Loss carryforwards | | $ | 3.7 | | $ | 47.7 | | $ | 44.0 | | $ | 51.1 | | $ | 0.9 | Decommissioning obligation | | | 39.6 | | | 39.3 | | | (0.3) | | | (1.7) | | | (0.3) | Defined benefit plans | | | 4.0 | | | 4.6 | | | (5.7) | | | (5.8) | | | (3.1) | Property, plant and equipment | | | (391.2) | | | (387.9) | | | 3.3 | | | (26.4) | | | 8.3 | Goodwill, intangible assets and other assets | | | (493.2) | | | (452.1) | | | 41.1 | | | 3.0 | | | 19.2 | Long-term debt and derivative financial instruments | | | (6.0) | | | (0.3) | | | (0.5) | | | (0.3) | | | 0.7 | Other | | | 20.7 | | | (15.9) | | | (36.7) | | | (3.7) | | | (1.1) | | | $ | (822.4) | | $ | (764.6) | | $ | 45.2 | | $ | 16.2 | | $ | 24.6 |
Changes in the net deferred income tax liability are as follows: | | | | | | | | | 2025 | | 2024 | Balance at beginning of year | | $ | (764.6) | | $ | (759.2) | Recognized in income | | | (45.2) | | | (16.2) | Recognized in other comprehensive income | | | (12.5) | | | (1.6) | Other | | | (0.1) | | | 12.4 | Balance at end of year | | $ | (822.4) | | $ | (764.6) |
There are no income tax consequences attached to the payment of dividends or distributions by the Corporation to its shareholder. Pillar Two legislation, which introduces new taxing mechanisms that could impose a minimum tax on income from the Corporation and its subsidiaries, was substantively enacted in Canada in 2024. The implementation of these new tax rules in 2025 and 2024 has no impact on the Corporation.
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