Quarterly report pursuant to Section 13 or 15(d)

Income Taxes

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Income Taxes
3 Months Ended
May 31, 2020
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Our effective tax rate for the three months ended May 31, 2020, was 153.1% of tax expense as compared with 43.9% of tax benefit for the three months ended May 31, 2019.

For the three months ended May 31, 2020, our effective tax rate was higher than the federal statutory rate of 21% primarily due to:

valuation allowances on the net unrealized loss from the changes in fair value of our investments in Canopy and Canopy equity in earnings (losses); and
valuation allowances on existing capital loss carryforwards; partially offset by
the benefit of lower effective tax rates applicable to our foreign businesses.

For the three months ended May 31, 2019, our effective tax rate was higher than the federal statutory rate of 21% primarily due to the net unrealized loss from the changes in fair value of our investments in Canopy. Our effective rate benefited from the following:

the reversal of valuation allowances for capital loss carryforwards in connection with the Original Wine and Spirits Transaction;
the recognition of a net income tax benefit from stock-based compensation award activity, and
lower effective tax rates applicable to our foreign businesses.