2004 Crown Investments Corporation of Saskatchewan Annual Report

Notes to Consolidated Financial StatementsDecember 31, 200416. Public Policy ExpenditureThe Corporation through Cabinet was directed to provide the lowest combined costs in Canada for certainresidential products provided by its subsidiaries Saskatchewan Power Corporation (residential power),Saskatchewan Telecommunications Holding Corporation (basic residential phone service), SaskEnergyIncorporated (residential heating) and Saskatchewan Government Insurance (basic car insurance).During the year the Corporation determined it would need to provide $137 per household to meetthe directive. Each payout was delivered as a credit on one of each household’s SaskatchewanTelecommunications Holding Corporation, Saskatchewan Power Corporation or SaskEnergy Incorporatedbill.17. Income TaxesIncome tax expense differs from the amount that would be computed by applying the federal and provincialstatutory income tax rates to income before income taxes. The main reasons for the differences are asfollows (thousands of dollars):2004 2003Net income (loss) before income taxes from taxablesubsidiaries and joint ventures$71,432$23,009Combined federal and provincial tax rate39.0%38.7%Computed tax expense based on the combined rateIncrease (decrease) resulting from:Earnings not subject to taxationAdjustment to future tax assets for enactedchanges in tax laws and ratesDifference in tax rates between subsidiaries and parentValuation allowanceOther$27,879(1,033)(546)-129(193)$8,894(3,430)(13,934)(11)8,330(318)Total future income tax expense$26,236$(469)83