Taxation Taxation of the Company The following is a summary of certain material tax considerations relating to Amdocs and our subsidiaries. To the extent that the discussion is based on tax legislation that has not been subject to judicial or administrative interpretation, there can be no assurance that the views expressed in the discussion will be accepted by the tax authorities in question. The discussion is not intended, and should not be construed, as legal or professional tax advice and is not exhaustive of all possible tax considerations. Our effective tax rate was 13.3% for fiscal 2013, compared to 11.4% for fiscal 2012 and 12.4% for fiscal 2011. There can be no assurance that our effective tax rate will not change over time as a result of a change in corporate income tax rates or other changes in the tax laws of Guernsey, the jurisdiction in which our holding company is organized, or of the various countries in which we operate. Moreover, our effective tax rate in future years may be adversely affected in the event that a tax authority challenged the manner in which items of income and expense are allocated among us and our subsidiaries. In addition, we and certain of our subsidiaries benefit from certain special tax benefits. The loss of any such tax benefits could have an adverse effect on our effective tax rate. Tax legislation in Guernsey subjects us to the standard rate of corporate income tax for a Guernsey resident company of zero percent. We operate development centers and a business processing operations center in India. In 2013, the corporate tax rate applicable in India on trading activities was 33.99%. Our Indian business operates under specific favorable tax entitlements that are based upon pre-approved information technology related services activity. As a result, we are entitled to considerable corporate income tax exemptions on all income derived from such pre- approved information technology activity, provided we continue to meet the conditions required for such tax benefits. However, as of April 1, 2011, the Minimum Alternative Tax, or MAT, became applicable to all of our Indian operations. The MAT is levied on book profits at the effective rate of 20% (during the Indian fiscal year commencing on April 1, 2011) and can be carried forward for 10 years to be credited against corporate income taxes. We are subject to a separate tax entitlement under which we are exempt from tax on our tax incentive- eligible activity for the first five years of operations and enjoy a 50% reduction on its corporate income tax for such activity for the following five years. After 10 years of operations, such 50% reduction may be available for an additional five years, subject to further investment-related undertakings that we would be required to make. Under Indian laws, any dividend distribution by our Indian subsidiary would be subject to a dividend distribution tax at the rate of 16.995% to be paid by such subsidiary. The Indian government has published a draft for the replacement of the country’s tax code. This draft, if enacted, would substantially change Indian tax laws, and might reduce or eliminate the availability of these beneficial tax rates for our activities in India. Our Israeli subsidiary, Amdocs (Israel) Limited, operates one of our largest development centers. Discussed below are certain Israeli tax considerations relating to this subsidiary. General Corporate Taxation in Israel. The Companies Tax rate on taxable income is 25%. However, the effective tax rate payable by an Israeli company that derives income from an Approved Enterprise may be considerably less. Starting January 1, 2014, the corporate tax rate in Israel is 26.5%. 58 General Certain Guernsey Tax Considerations Certain Indian Tax Considerations Certain Israeli Tax Considerations