KO · 10-Q · 2026Q3 · Full report

Income Tax Rate Changes

COCA COLA CO · 2026-07-29 · Importance 50 · Surprise 58

Six-month income taxes declined to $1.682 billion from $1.715 billion, while the effective tax rate fell to 16.7% from 19.4%. The 2026 effective tax rate included $319 million of net discrete tax benefits, including $98 million of interest income related to the IRS Tax Litigation Deposit and a $181 million net benefit primarily from return-to-provision adjustments. Management expects a 2026 effective tax rate of approximately 19.9% before significant operating and nonoperating items, excluding any potential impact from the IRS litigation.

Key facts

• Based on current tax laws the Company’s effective tax rate in 2026 is expected to be approximately 19.9% before considering the potential impact of any significant operating and nonoperating items.
• The Company recorded income taxes of $1,682 million (16.7% effective tax rate) and $1,715 million (19.4% effective tax rate) during the six months ended July 3, 2026 and June 27, 2025, respectively.
• The Company recorded income taxes of $1,037 million (18.9% effective tax rate) and $993 million (20.7% effective tax rate) during the three months ended July 3, 2026 and June 27, 2025, respectively.