PG · 10-K · 2026A · Full report

Income Tax Rate Changes

PROCTER & GAMBLE Co · 2026-08-04 · Importance 34 · Surprise 42

Operating cash flow included a $333 million reduction from other impacts, primarily reflecting the final payment of the transitional tax related to the 2017 U.S. Tax Act. P&G’s fiscal-2026 core earnings reconciliation included $81 million of incremental-restructuring tax adjustments. The company stated that changes in tax legislation, geographic earnings mix, tax-audit outcomes or repatriation plans could affect its effective tax rate.

Key facts

• Other impacts reduced cash by $333 million primarily driven by the final payment of the transitional tax related to the 2017 U.S. Tax Act and a reduction in postretirement benefit accruals. source
• The effective income tax rate for fiscal year ended June 30, 2026, was 20.8% compared to 20.3% for fiscal year ended June 30, 2025. source
• The increase in the effective tax rate was primarily driven by lower excess tax benefits of share-based compensation and unfavorable geographic mix impacts, partially offset by a decrease from discrete impacts related to uncertain tax positions and the prior year charge for accumulated foreign currency translation losses due to Argentina liquidation. source