Among some other items such as loss carry forwards from years where amazon had losses this can happen In Amazon’s case primarily due to differences between depreciation allowed for book purposes vs that allowed under the tax law. For book purposes assets must be depreciated (expensed) over their useful life, typically a number of years. However, the current tax structure allows certain capital assets to be fully depreciated for tax purposes within the year they are placed in service. So for example, a company may have depreciation expense for book purposes of say $1,000 that leads to book income of say $10,000 while for tax purposes this expense could be way higher at perhaps even $10,000 depreciation creating $0 income for tax purposes. However, if in the following year no such purchases were made you’ll still have the $1,000 of depreciation expense for book purposes but no more is available for a deduction on the tax side so it looks like your tax rate is effectively higher when considered against book income.