List one reason why a corporation's effective tax rate (ETR) deviates from the statutory tax...
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Accounting
List one reason why a corporation's effective tax rate (ETR) deviates from the statutory tax rate (21%).
The answer my professor gave was that permanent book/tax differences (BTD's) cause the rate to change when calculating income tax expense (income tax expense = [book income - permanent BTD's] * enacted tax rate). But I don't understand this answer, as permanent BTD's don't actually change the enacted tax rate.
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