VLTO · 10-Q · 2026Q2 · Full report

Income Tax Rate Changes

Veralto Corp · 2026-04-29 · Importance 54 · Surprise 50

The Company’s effective tax rate was 20.9% for the three months ended April 3, 2026 compared to 22.1% in the prior-year quarter, driven principally by geographic mix and the favorable impact of tax law changes under the One Big Beautiful Bill Act (OBBBA), partially offset by a $2 million net discrete provision. Veralto operates across multiple significant non-U.S. jurisdictions including Belgium, Brazil, Canada, China, Germany, the Netherlands and the United Kingdom, and notes that changes in statutory rates in any single non-U.S. country (outside those listed) would not be expected to have a material impact due to geographic dispersion. The Company also describes a tax matters agreement with Danaher that allocates responsibility for pre-Separation “Joint” filings to Danaher and leaves certain “Separate” filings (primarily outside the U.S.) with Veralto. Management performs quarterly reviews of global tax positions and accrues reserves for contingent tax liabilities as warranted.

Key facts

• The effective tax rate was 20.9% for the three-month period ended April 3, 2026 and 22.1% for the three-month period ended April 4, 2025.
• The effective tax rate for the three-month period ended April 3, 2026 differed from the U.S. federal statutory rate of 21% principally due to geographic mix of earnings and the favorable impact of tax law changes under the One Big Beautiful Bill Act (OBBBA), partially offset by a net discrete provision of $2 million related primarily to a gain on a minority interest holding.
• The net discrete provision of $2 million increased the effective tax rate by 0.6% for the three-month period ended April 3, 2026.
• For the three-month period ended April 4, 2025, the Company had a non-deductible loss on the sale of a product line of $2 million and a net discrete benefit of $2 million related primarily to excess tax benefits from stock-based compensation.