Components of Future Income Taxes (millions of dollars) ENBRIDGE 2000 ANNU AL REPORT 46 Accumulated future income taxes related to rate-regulated operations which have not been recorded in the accounts amounted to $561.9 million at December 31, 2000 (1999 — $743.3 million). Had the liability method been prescribed by the regulatory authorities for ratemaking purposes, such amounts would have been recorded and recovered in revenues to date. At December 31, 2000, the Company has unused tax loss carryforwards of $459.4 million. The losses expire as follows:  2001 — $0.1 million; 2002 — $0.5 million; 2003 — $0.7 million; 2004 — $8.9 million; 2005 — $54.9 million;  2006 — $159.7 million; and 2007 — $234.6 million. Income Tax Rate Reconciliation In 2000, income taxes paid amounted to $114.7 million (1999 — $79.6 million; 1998 — $163.5 million). Year ended December 31, 2000 1999 1998 Earnings before income taxes 412.6 387.3 336.2 Combined statutory income tax rate 43.3% 44.6% 44.6% Income taxes at statutory rate 178.8 172.7 150.0 Increase/(decrease) resulting from: Tax rate reductions on future income tax balances (103.7) — — Future income taxes related to regulated operations (40.9) (37.1) (18.6) Non-taxable items, net (31.0) (48.7) (2.9) Lower foreign tax rates (21.0) (16.0) (27.1) Income taxes recoverable related to prior years 0.3 1.6 (17.3) Large Corporations Tax in excess of surtax 16.1 14.4 10.1 Other (0.5) 0.6 1.1 Income taxes (1.9) 87.5 95.3 Effective income tax rate — 22.6% 28.3% Year ended December 31, 1999 1998 Recognition of tax losses available for carryforward (39.8) (14.5) Timing of recognition of regulatory deferral accounts 44.7 (14.2) Other 0.6 2.6 5.5 (26.1) Under the deferral method, the components of deferred income taxes were as follows. (millions of dollars) December 31, 2000 Future Income Tax Liabilities Differences in financial and tax bases of PP&E 827.9 Undistributed equity income 28.4 Other 56.5 912.8 Future Income Tax Assets Loss carryforwards 147.8 Other 8.4 156.2 Total Net Future Income Tax Liability 756.6