Table:
|  |  | Years Ended December 31, |  |
| --- | --- | --- | --- |
|  | 2019 | 2018 | 2017 |
| Income taxes per federal statutory rate | $14,111 | $36,199 | $69,348 |
| State income taxes, net of federal deduction | 10 | 2,372 | 1,794 |
| Transition tax - U.S. Tax Reform | — | 1,174 | 61,690 |
| Corporate tax rate changes - U.S. Tax Reform | — | (652) | 11,177 |
| Tax benefit associated with inverter business wind down | — | — | (33,837) |
| Stock based compensation | (97) | (974) | (5,263) |
| GILTI Tax | 8,796 | 13,064 | — |
| Tax effect of foreign operations | (13,086) | (19,162) | (47,482) |
| Uncertain tax position | (4,487) | (3,088) | 4,948 |
| Unremitted earnings | 1,624 | 2,564 | — |
| Tax credits | (6,280) | (9,844) | (658) |
| Change in valuation allowance | 7,222 | (1,306) | 841 |
| Withholding taxes | 6,500 | 1,371 | — |
| Other permanent items, net | (3,614) | 3,509 | (468) |
| Total provision for income taxes | $10,699 | $25,227 | $62,090 |
Paragraphs:
ADVANCED ENERGY INDUSTRIES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (continued) (in thousands, except per share amounts)
The Company’s effective tax rate differs from the U.S. federal statutory rate of 35% for the year ended December 31, 2017, primarily due to the benefit related to the wind down of our solar inverter business and earnings in foreign jurisdictions, which are subject to lower tax rates, offset by the impact of U.S. tax reform. The principal causes of the difference between the federal statutory rate and the effective income tax rate for each the years below are as follows:
Question:
Why did the company's effective tax rate differ from the U.S. federal statutory rate?
Answer: due to the benefit related to the wind down of our solar inverter business and earnings in foreign jurisdictions, which are subject to lower tax rates, offset by the impact of U.S. tax reform.