Quarterly report pursuant to Section 13 or 15(d)

INCOME TAXES

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INCOME TAXES
 6 Months Ended
Jun. 28, 2020
Income Tax Disclosure [Abstract]  
Income Tax Disclosure
NOTE 6. INCOME TAXES
Our effective tax rates for the three and six months ended June 28, 2020, were 25.7 percent and 21.6 percent, respectively. Our effective tax rates for the three and six months ended June 30, 2019, were 21.4 percent and 21.1 percent, respectively, and contained immaterial discrete items.
The three months ended June 28, 2020, contained unfavorable discrete items of $14 million, primarily due to changes in tax reserves on certain U.S. tax matters.
The six months ended June 28, 2020, contained $4 million of favorable net discrete tax items, primarily due to favorable tax changes within India's 2020-2021 Union Budget of India (India Tax Law Change) passed in March of 2020, partially offset by unfavorable changes in tax reserves in the second quarter of 2020. The India Tax Law Change eliminated the dividend distribution tax and replaced it with a lower rate withholding tax as the burden shifted from the dividend payor to the dividend recipient for a net favorable income statement impact of $35 million.
The India Tax Law Change resulted in the following adjustments to the Income Statement in the first half of 2020:
In millions Favorable (Unfavorable)
Equity, royalty and interest income from investees $ 37   
Income tax expense (1)
17   
Less: Net income attributable to noncontrolling interests (19)  
Net income statement impact $ 35   
(1) The adjustment to "Income tax expense" includes $15 million of discrete items.