Note 9 - Income Taxes |
3 Months Ended | ||
|---|---|---|---|
Sep. 30, 2021 | |||
| Notes to Financial Statements | |||
| Income Tax Disclosure [Text Block] |
We recorded income tax expense of $7.2 million in the first quarter of fiscal 2022 compared with $1.9 million in the prior year comparable period. Our current quarter consolidated effective tax rate was 26.3% compared with 16.8% in the prior year. Our first quarter of fiscal 2022 effective tax rate of 26.3% varies from the 21% federal statutory rate primarily due to state taxes. The increase in the effective tax rate compared with the first quarter a year prior was primarily due to a $0.9 million reduction in our valuation allowance on deferred tax assets.
As of September 30, 2021, a valuation allowance of $0.6 million was in place against the retail segment's Canadian tax assets, consistent with June 30, 2021.
We recognize interest and penalties related to income tax matters as a component of income tax expense. As of September 30, 2021, we had $2.2 million of unrecognized tax benefits compared with $2.0 million as of June 30, 2021. It is reasonably possible that various issues relating to approximately $0.4 million of the total gross unrecognized tax benefits as of September 30, 2021 will be resolved within the next 12 months as exams are completed or statutes expire. If recognized, approximately $0.4 million of unrecognized tax benefits would reduce our income tax expense in the period realized. |