Deferred tax assets and liabilities

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12. Deferred tax assets and liabilities

These are composed as follows:

(in thousands of Euros)
12/31/2007		12/31/2006
Deferred tax assets	58,524	64,230
Deferred tax liabilities	(44,625)	(42,931)
13,899		21,299

Since deferred tax assets and liabilities are offset in the financial statements when the income taxes are levied by the same tax authority and where there is a legally enforceable right of offset, the composition of the gross amounts is presented below:

(in thousands of Euros)
12/31/2007		12/31/2006
Deferred tax assets:	156,211	157,851
- of which, recoverable within 12 months	55,188	66,561
- of which, recoverable beyond 12 months	101,023	91,290
Deferred tax liabilities:	(142,312)	(136,552)
. of which, recoverable within 12 months	(4,311)	(3,514)
. of which, recoverable beyond 12 months	(138,001)	(133,038)
13,899		21,299

Temporary differences which make up deferred tax assets and liabilities at December 31, 2007 and 2006 are as follows:

(in thousands of Euros)
12/31/2007		12/31/2006
Deferred tax assets
- Provision for other liabilities and charges	27,370	34,973
- Employee benefit obligations	25,486	36,763
- Inventories	14,063	16,108
- Tax loss carryforwards	26,679	13,806
- Depreciation and amortization	6,785	4,243
- Trade and other receivables	16,719	8,101
- Trade and other payables	17,458	18,079
- Intragroup transactions	8,650	9,027
- Other	13,001	16,751
156,211		157,851
Deferred tax liabilities
- Depreciation and amortization	(123,037)	(118,658)
- Other	(19,275)	(17,895)
(142,312)		(136,553)

At December 31, 2007, deferred tax assets relating to temporary differences that have not been recognized amount to Euros 54,087 thousand and refer to situations in which their recoverability
is not considered probable.

Unused tax loss carryforwards, by expiration date, are as follows:

(in thousands of Euros)
Year of expiration	12/31/2007	12/31/2006
2007	-	22,659
2008	146,727	147,262
2009	289,877	290,968
2010	144,746	165,187
2011	88,627	77,618
2012	479,072	52,470
2013	18,447	1,918
2014	669	-
2021	26,925	30,096
2022	62,067	68,844
2023	3,723	4,161
2024	9,043	10,108
without expiration	406,268	418,262
1,676,191		1,289,553

These losses, in most cases, refer to situations in which recoverability is not considered probable. As a result, deferred tax assets on unused losses have been recognized in the financial statements for Euros 12,408 thousand (Euros 13,806 thousand at December 31, 2006) and the unrecognized portion amounts to Euros 460,697 thousand (Euros 409,766 thousand at December 31, 2006).

The tax effect of gains and losses recognized directly in equity is a negative Euros 2,856 thousand (negative Euros 6,935 thousand at December 31, 2006), and is shown in the statement of recognized income and expense. These movements are mainly due to the tax effect of actuarial gains/losses on employee benefits and the changes in fair value of available-for-sale financial assets.