41 NOTE 7 Income taxes At Dec. 30, 2001, the accumulated postretirement benefit obligation was determined using a discount rate of 7.25% and  a health care cost trend rate of 7% for pre-age 65 benefits, decreasing to 5% in the year 2004 and thereafter. For post-age 64 benefits, the health care cost trend rate used was 10%, declining to 5% in the year 2005 and thereafter. The provision for income taxes on income from continuing  operations consists of the following: At Dec. 31, 2000, the accumulated postretirement benefit obligation was determined using a discount rate of 7.625% and a health care cost trend rate of 8% for pre-age 65 benefits, decreasing to 5% in the year 2005 and thereafter. For post-age 64 benefits, the health care cost trend rate used was 12%, decreasing to 5% in the year 2005 and thereafter.  The company’s policy is to fund the above-mentioned  benefits as claims and premiums are paid. The effect of a 1% increase in the health care cost trend rate used would result in increases of approximately $27 million in the 2001 postretirement benefit obligation and $3 million in the aggregate service and interest components of the 2001 expense. The effect of a 1% decrease in the health care cost trend rate used would result in decreases of approximately $23 million in the 2001 postretirement benefit obligation and $3 million in the aggregate service and interest components of the 2001 expense. In addition to the income tax provision presented above for  continuing operations, the company also recorded federal and state income taxes payable on discontinued operations of $891 million in 2000 and $28 million in 1999. The provision for income taxes on continuing operations  exceeds the U.S. federal statutory tax rate as a result of the  following differences: The company has not provided for U.S. taxes on a portion  of earnings from its U.K. operations which it considers perma- nently invested in these operations. Fiscal year 2001 2000 1999 U.S. statutory tax rate 35.0% 35.0% 35.0% Increase in taxes resulting from: State/other income taxes net of federal income tax benefit 3.0 3.1 3.2 Goodwill amortization not deductible for tax purposes 3.8 2.2 1.7 Other, net (2.4) (0.7) (0.1) Effective tax rate 39.4% 39.6% 39.8% In thousands of dollars  In thousands of dollars  In thousands of dollars  2001 Current Deferred Total Federal $ 241,713 $ 200,065 $ 441,778 State and other 34,437 28,504 62,941 Foreign 34,681 0 34,681 Total $ 310,831 $ 228,569 $ 539,400 2000 Current Deferred Total Federal $518,413 $ 13,414 $531,827 State and other 75,865 1,963 77,828 Foreign 25,041 2,204 27,245 Total $619,319 $ 17,581 $636,900 1999 Current Deferred Total Federal $505,902 $ 14,791 $520,693 State and other 72,927 2,132 75,059 Foreign 10,863 1,185 12,048 Total $589,692 $ 18,108 $607,800