Amrize LtdAMRZ
Amrize Ltd Income Taxes Disclosure
Income taxes
As the Company is incorporated in Switzerland. the components of income tax expense and the effective tax
rate tables are based on Switzerland’s federal tax rate.
Income tax provision
The components of Income before income tax expense and income from equity method investments are as
follows:
For the years ended December 31, | |||||
(In millions) | 2025 | 2024 | 2023 | ||
Swiss | $288 | $328 | $218 | ||
Non-Swiss | 1,209 | 1,300 | 1,085 | ||
Total income before income tax expense and income from equity method investments | $1,497 | $1,628 | $1,303 | ||
The provision for income taxes consists of the following:
For the years ended December 31, | |||||
(In millions) | 2025 | 2024 | 2023 | ||
Current: | |||||
Swiss – Federal | $24 | $24 | $2 | ||
Swiss – Cantonal | 11 | — | 1 | ||
Non-Swiss | 213 | 379 | 347 | ||
Total current tax expense | 248 | 403 | 350 | ||
Deferred: | |||||
Swiss – Federal | (1) | 25 | 17 | ||
Swiss – Cantonal | — | 14 | 7 | ||
Non-Swiss | 79 | (74) | (13) | ||
Total deferred tax expense (benefit) | 78 | (35) | 11 | ||
Total income tax expense | $326 | $368 | $361 | ||
For purposes of the effective tax rate reconciliation, the Company uses the Swiss federal statutory income
tax rate of 8.5%. A reconciliation of the statutory Swiss federal tax rate and the Company’s effective tax rate
is as follows:
For the years ended December 31, | ||||||
(In millions, except for percentage data) | 2025 | % | 2024 | % | 2023 | % |
Swiss federal statutory tax rate | $127 | 8.5 | $138 | 8.5 | $111 | 8.5 |
Cantonal income taxes (1) | 11 | 0.7 | 14 | 0.8 | 8 | 0.6 |
Changes in unrecognized tax benefits | (20) | (1.4) | 15 | 0.9 | 43 | 3.3 |
OECD Pillar Two tax | (6) | (0.4) | 24 | 1.5 | ||
Other adjustments: | ||||||
Deferred tax adjustments | 7 | 0.5 | ||||
Other | (3) | (0.1) | (2) | (0.1) | ||
Foreign tax effects | ||||||
United States | ||||||
Effect of rates different than statutory | 97 | 6.5 | 118 | 7.2 | 96 | 7.4 |
State and local income taxes | 33 | 2.2 | 46 | 2.8 | 46 | 3.6 |
Nontaxable or nondeductible items | 5 | 0.4 | ||||
Other adjustments: | ||||||
Percentage depletion | (17) | (1.1) | (18) | (1.1) | (16) | (1.3) |
Deferred tax adjustments | (18) | (1.1) | 2 | 0.2 | ||
Purchase price adjustments | (13) | (0.8) | ||||
Other | (2) | (0.1) | (8) | (0.5) | 4 | 0.3 |
Canada | ||||||
Effect of rates different than statutory | 70 | 4.6 | 58 | 3.5 | 51 | 4.0 |
State and local income taxes | 1 | 0.1 | 1 | 0.1 | 1 | 0.1 |
Nontaxable or nondeductible items | 7 | 0.5 | 7 | 0.6 | ||
Other adjustments: | ||||||
Repatriation cost | 28 | 1.8 | ||||
Other | (1) | (0.1) | 6 | 0.4 | 3 | 0.1 |
Other foreign jurisdictions: | ||||||
Other adjustments | 1 | 0.1 | ||||
Total income tax expense | $326 | $368 | $361 | |||
Effective income tax rate | 21.8% | 22.6% | 27.8% | |||
__________________
(1)Entirely comprised of income taxes from the Canton of Zug.
The Company’s effective income tax rate for the year ended December 31, 2025 was higher than the Swiss
statutory rate due to the Company’s jurisdictional mix of earnings, and repatriation costs, which were partially
offset by changes in uncertain tax positions, percentage depletion, and a reduction in Pillar Two taxes from
new regulatory guidance.
The Company’s effective income tax rate for the year ended December 31, 2024 was higher than the Swiss
statutory rate due to the Company’s jurisdictional mix of earnings, changes in uncertain tax positions, and
Pillar Two taxes, which was offset by percentage depletion and return to provision adjustments.
The Company’s effective income tax rate for the year ended December 31, 2023 was higher than the Swiss
statutory rate due to the Company’s jurisdictional mix of earnings, changes in uncertain tax positions, and
return to provision adjustments, which was partially offset by percentage depletion.
Income Taxes Paid
For the years ended December 31, | |||||
(In millions) | 2025 | 2024 | 2023 | ||
Swiss | $— | $— | $— | ||
United States | 230 | 196 | 142 | ||
Canada | 139 | 106 | 69 | ||
Total income taxes paid | $369 | $302 | $211 | ||
No Swiss federal or cantonal income tax was paid in the year. Any income tax attributed to the pre-spin
period was accrued and paid by Holcim. The Company will pay Swiss income tax for the post-spin 2025
period in 2026 in accordance with Swiss tax law.
Deferred income tax liabilities, net
The components of Deferred income tax liabilities, net were as follows:
As of December 31, | |||
(In millions) | 2025 | 2024 | |
Deferred tax assets: | |||
Deferred expenses and defined benefit pension plan obligations | $265 | $291 | |
Lease liabilities | 171 | 138 | |
Site restoration | 122 | 61 | |
Net operating loss | 90 | 22 | |
Other assets | 49 | 78 | |
Total deferred tax assets | 697 | 590 | |
Less: valuation allowances | (66) | (13) | |
Total deferred tax assets after valuation allowances | $631 | $577 | |
Deferred tax liabilities: | |||
Cost depletion | $(144) | $(107) | |
Property, plant and equipment | (1,018) | (1,009) | |
Intangible and other long-lived assets | (301) | (260) | |
Leased right-of-use assets | (163) | (137) | |
Other liabilities | (33) | — | |
Total deferred tax liabilities | (1,659) | (1,513) | |
Total net deferred tax liabilities | $(1,028) | $(936) | |
Reported as: | |||
Deferred tax liabilities | $(1,048) | $(936) | |
Other noncurrent assets | 20 | — | |
Deferred tax liabilities, net | $(1,028) | $(936) | |
The change in the net deferred income tax liabilities from December 31, 2024 to December 31, 2025 was
primarily driven by a repatriation cost deferred tax liability recorded on the current year unremitted earnings
that are not indefinitely reinvested. There was also an increase in the intangible deferred tax liability related to
goodwill and intellectual property tax amortization that exceeds book amortization.
As of December 31, 2025 and 2024, the Company had $752 million and $227 million, respectively, of gross
loss carryforwards, of which approximately $599 million and $181 million, respectively, related to U.S. state
gross loss carryforwards, and the remaining relates to Canada and Switzerland. The net operating loss and
credit carryforwards have various expiration dates from 2026 to an indefinite carryforward period in the
United States, expiration years of 2031 and 2032 in Switzerland, and various expiration years in Canada
ranging from 2032 to 2045.
Valuation Allowances Related to Deferred Taxes:
The summary of the change in valuation allowance at December 31 was:
(In millions) | 2025 | 2024 | 2023 | ||
Balance as of January 1 | $13 | $12 | $12 | ||
Increase (decrease) charged to tax expense | 3 | 1 | — | ||
Currency translation and other | 50 | — | — | ||
Balance as of December 31 | $66 | $13 | $12 |
The net change in the total valuation allowance for the years ended December 31, 2025 and 2024 was $53
million and $1 million, respectively. The 2025 movement is primarily related to the U.S valuation allowance
that was previously net with its respective net operating losses or state credit carryforwards.
Tax uncertainties
A reconciliation of the changes in the gross amount of unrecognized tax benefits is as follows:
(In millions) | 2025 | 2024 | 2023 | ||
Balance as of January 1 | $167 | $161 | $128 | ||
Increases related to current period tax positions | 2 | 15 | 27 | ||
Increases related to prior period tax positions | 14 | 10 | 8 | ||
Decreases related to prior period tax positions | (3) | (12) | — | ||
Decreases related to lapses in statutes of limitations | (40) | (7) | (2) | ||
Balance as of December 31 | $140 | $167 | $161 |
As of December 31, 2025, the Company had $140 million of unrecognized tax benefits, accrued interest and
penalties, which would favorably impact the Company’s future tax rates in the event that the tax benefits are
eventually recognized. We include interest and penalties related to uncertain tax positions as a component of
income tax expense. For the years ended December 31, 2025, 2024 and 2023, the Company had accrued
interest and penalties totaling $49 million, $42 million and $32 million, respectively, as well as accrued
liabilities totaling $91 million, $125 million and $129 million, respectively.
Our unrecognized tax benefits for uncertain positions are included within Other Non-current Liabilities on our
consolidated balance sheet.
Our unrecognized tax benefits decreased during 2025 primarily related to statute of limitations expirations,
which was partially offset by a net increase for tax positions related to the current and prior years in the U.S
and Canada.
Our unrecognized tax benefits increased during 2024 primarily due to an increase in tax positions related to
the current and prior years in the U.S and Canada partially offset by statute of limitations expirations.
Our unrecognized tax benefits increased during 2023 primarily due to an increase in tax positions related to
the current and prior years in the U.S and Canada partially offset by statute of limitations expirations.
The Company is subject to ongoing tax examinations in the United States and Canada. The specific timing of
when these open examinations will be concluded is uncertain. Tax controversies have substantially concluded
for U.S state income tax matters through 2020, and Canada through 2008.
Indefinite Reinvestment
Cumulative unremitted earnings of the Company’s U.S. and Canadian subsidiaries could be taxable if
repatriated in a future period. The unremitted retained earnings in the U.S. business are planned to be
reinvested indefinitely. However, due to additional cash needs in the U.S. to support anticipated acquisition
activity as well as anticipated plant refurbishment in Canada, the Canadian business plans to potentially
repatriate $550 million of the cumulative unremitted earnings and indefinitely reinvest remaining unremitted
earnings. The Company has recognized a deferred tax liability of approximately $23 million on the current
year unremitted earnings that are not indefinitely reinvested. Quantification of the deferred tax liability, if any,
associated with indefinitely reinvested earnings is not practicable.
Recent Tax Law Changes
Effective January 1, 2024, the Company is subject to the 15% minimum tax rate provisions of the Organization
for Economic Co-operation and Development (“OECD”) Pillar Two framework enacted into law in both
Switzerland and Canada. Estimated Pillar Two top-up taxes of $12 million and $24 million have been included
in the calculation of the Company’s total income tax expense for the years ended December 31, 2025 and
2024, respectively. Further, in the first quarter of 2025, new legislation was introduced around Pillar Two that
resulted in the Company recognizing a benefit of $18 million.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law, which reinstates several
favorable tax provisions effective in 2025. The tax effects of the OBBBA have been recognized in the period
of enactment and did not have a material impact on our effective tax rate for the period ended December 31,
2025.About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.