Note 29 Tax
Current tax expense
Movement in deferred tax
The recognised tax expense of €74 million is made up of tax charges of €71 million for 2018 and an adjustment of €3 million relating to prior years.
The corporate income tax charge on the taxable profit of the Alliander N.V. tax group for 2018 amounts to €65 million. This is the balance of the calculated corporate income tax on the profit for 2018 (€69 million) and the calculated corporate income tax on movements in balance sheet items recognised directly in equity (€4 million tax credit).
The change in deferred tax, which was down by €45 million, is the net effect of a change in deferred tax assets (€46 million) as well as in deferred tax liabilities (€1 million).
The table below provides a reconciliation between the corporate income tax rate in the Netherlands and the effective tax rate:
Reconciliation of effective corporate income tax rate
Enacted corporate income tax rate in the Netherlands
Change in corporate income tax rate
Losses not accounted for
Other permanent differences
Effective corporate income tax rate
The effective tax rate is the tax burden expressed as a percentage of the profit before tax excluding the profits after tax from associates and joint ventures. The effective tax rate in 2018 amounted to 26.5% (2017: 25.7%). The difference compared with the standard tax rate of 25% is mainly due to the applicability of the substantial-holding privilege (downward effect of 5.8%) and the effect of the changes in the rate of corporate income tax (upward effect of 6.5%). The upward effect of permanent differences (0.3%) concerns various non-deductible expenses. The unrecognised tax losses of our entities outside the Netherlands also influence the effective tax rate (upward effect of 0.5%).