sain t-gobain annu al report 2008 annual report

Plan surpluses and provisions for pensions
and other post-employment benefits classified
as assets and liabilities held for sale
No plan surpluses or provisions for pensions and other postemployment
benefits were classified as assets and liabilities
held for sale in accordance with IFRS 5 at December 31, 2008
and at December 31, 2007. Plan surpluses and provisions for
pensions and other post-employment benefits classified as
assets and liabilities held for sale at December 31, 2006
amounted to €2 million and €18 million respectively (see
Note 2).
NOTE 14
Current and deferred taxes
Until December 31, 2006, Compagnie de Saint-Gobain was
assessed for income tax on its consolidated taxable income.
Under this arrangement, the Group’s share of the aggregate
amount of income taxes paid by Group companies included in
the worldwide tax group was taken into account when determining
consolidated taxable income. Since January 1, 2007, tax
consolidation only applies at a local level.
The pre-tax income of consolidated companies is as follows:
Employee benefits expense
The cost of the Group’s pension and other post-employment
benefit plans (excluding other employee benefits) is as
follows:
(in € millions) 2008 2007 2006
Service cost 167 200 217
Interest cost 420 430 417
Return on plan assets (431) (451) (387)
Amortization of actuarial gains
and losses 0 0
Curtailments and settlements (3) (13) (3)
Pensions, length-of-service awards
and other post-employment benefits 153 166 244
Employee contributions (22) (25) (26)
Total 131 141 218
Additional information about pension costs
Pension contributions for 2008 represented an estimated
€874 million (2007: €772 million), including €419 million for
government-sponsored basic pension schemes (2007:
€388 million), €127 million for government-sponsored supplementary
pension schemes, mainly in France (2007:
€123 million), and €328 million for corporate-sponsored
supplementary pension plans (2007: €261 million), of which
€267 million for defined benefit plans (2007: €205 million)
and €61 million for defined contribution plans (2007:
€56 million).
(in € millions) 2008 2007 2006
Net income 1,437 1,543 1,682
less:
Share in net income of associates 11 14 7
Income taxes (638) (926) (899)
Pre-tax income
of consolidated companies 2,064 2,455 2,574
Income tax expense breaks down as follows:
(in € millions) 2008 2007 2006
Current taxes (639) (821) (802)
France (150) (144) (184)
Outside France (489) (677) (618)
Deferred taxes 1 (105) (97)
France (16) (13) (63)
Outside France 17 (92) (34)
Total income tax expense (638) (926) (899)
The effective tax rate paid by the Group on its consolidated
taxable income in 2006 was as follows:
(in %) 2006
Current income tax rate 33
French surtax 0
Royalties and net capital gains taxed at lower rates (1)
Other deferred and miscellaneous taxes 3
Effective tax rate 35
159 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Saint-Gobain – Financial Report 2008