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INCOME AND MINING TAXES | 12 Months Ended
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Dec. 31, 2022
Income Tax Disclosure [Abstract] |
INCOME AND MINING TAXES | INCOME AND MINING TAXES The following tables represent the major components of Income before taxes and Income and mining tax benefit (expense) recognized in the Consolidated Statements of Operations (in thousands):
| Years Ended December 31,
| 2022 |  | 2021 |  | 2020
Income before income and mining taxes components: |  |  |  |  |  |  |  |
United States | $ | 75,762 |  |  | $ | 138,230 |  |  | $ | 119,654 |
Canada |  | (21,831) |  |  |  | 26,752 |  |  |  | 26,207 |
Türkiye |  | 108,373 |  |  |  | 186,971 |  |  |  | 41,385 |
Other Foreign |  | 78,531 |  |  |  | 62,805 |  |  |  | 14,545 |
Total income before incomes taxes | $ | 240,835 |  |  | $ | 414,758 |  |  | $ | 201,791 |
| Years Ended December 31,
| 2022 |  | 2021 |  | 2020
Current income tax provision: |  |  |  |  |  |  |  |
United States | $ | 15,149 |  |  | $ | 15,603 |  |  | $ | 13,945 |
Canada |  | 33,408 |  |  |  | 27,672 |  |  |  | 5,720 |
Türkiye |  | 23,515 |  |  |  | 49,851 |  |  |  | 1,805 |
Other Foreign |  | 25,928 |  |  |  | 23,328 |  |  |  | 1,074 |
Total current income tax provision |  | 98,000 |  |  |  | 116,454 |  |  |  | 22,544 |
Deferred income tax provision (benefit): |  |  |  |  |  |  |  |
United States |  | 7,092 |  |  |  | 13,288 |  |  |  | 8,265 |
Canada |  | (4,183) |  |  |  | (230) |  |  |  | 765 |
Türkiye |  | (57,227) |  |  |  | (131,456) |  |  |  | 19,205 |
Other foreign |  | (13,614) |  |  |  | (12,172) |  |  |  | (7,576) |
Total deferred income tax provision (benefit) |  | (67,932) |  |  |  | (130,570) |  |  |  | 20,659 |
Total income tax provision (benefit) | $ | 30,068 |  |  | $ | (14,116) |  |  | $ | 43,203 |
Income and mining tax expense differs from the amount that would be computed by applying the Canadian statutory rate of 27% for each of the years ended December 31, 2022, 2021 and 2020, respectively, to income before income and mining taxes. The reasons for the differences are as follows (in thousands):
|  | Years Ended December 31,
|  | 2022 |  | 2021 |  | 2020
Income before income and mining taxes |  | $ | 240,835 |  | $ | 414,758 |  | $ | 201,791
Statutory tax rate |  |  | 27 | % |  |  | 27 | % |  |  | 27 | %
Expected income and mining tax expense |  |  | 65,025 |  |  | 111,985 |  |  | 54,484
Increase (decrease) attributable to: |  |  |  |  |  |  |  |  |
Non-taxable items |  |  | (11,358) |  |  | (4,379) |  |  | (22,236)
Foreign exchange and inflation |  |  | (20,531) |  |  | (124,946) |  |  | (676)
Differences in foreign and future tax rates |  |  | (13,248) |  |  | 738 |  |  | (10,641)
Investment incentive tax credits |  |  | (10,126) |  |  | (14,082) |  |  | 1,983
Mining taxes and overseas withholding tax |  |  | 38,251 |  |  | 17,528 |  |  | 17,006
Impact of gain on acquisition of Kartaltepe |  |  | (18,826) |  |  | — |  |  | —
Change in estimates in respect of prior years |  |  | (3,630) |  |  | (2,046) |  |  | (1,616)
Changes in recognition of deferred tax assets |  |  | 2,602 |  |  | 1,086 |  |  | 3,550
Other |  |  | 1,909 |  |  | — |  |  | 1,349
Total income and mining tax expense |  | $ | 30,068 |  | $ | (14,116) |  | $ | 43,203
The significant components of Deferred income tax assets and Deferred income tax liabilities were (in thousands):
| December 31,
| 2022 |  | 2021
Deferred income tax assets |  |  |  |  |
Deductible temporary differences relating to: |  |  |  |  |
Marketable securities | $ | 2,397 |  |  | $ | 634 |
Reclamation liabilities |  | 31,080 |  |  |  | 27,608 |
Lease liabilities |  | 28,730 |  |  |  | 23,895 |
Deductibility of other taxes |  | 10,224 |  |  |  | 9,299 |
Stock-based compensation |  | 2,931 |  |  |  | 7,247 |
Other items |  | 13,286 |  |  |  | 16,595 |
|  | 88,648 |  |  |  | 85,278 |
Investment incentive tax credits (1) |  | 18,772 |  |  |  | 46,354 |
Tax loss carryforwards |  | 43,384 |  |  |  | 25,395 |
Less: Valuation allowance |  | (61,101) |  |  |  | (38,496) |
Total deferred income tax assets | $ | 89,703 |  |  | $ | 118,531 |
Deferred income tax liabilities |  |  |  |  |
Taxable temporary differences relating to: |  |  |  |  |
Marketable securities | $ | — |  |  | $ | (270) |
Inventories |  | (49,004) |  |  |  | (17,768) |
Mineral properties, plant and equipment |  | (332,886) |  |  |  | (365,793) |
Convertible notes |  | (95) |  |  |  | (359) |
Mineral tax |  | (41,803) |  |  |  | (38,452) |
Foreign withholding tax |  | — |  |  |  | (17,080) |
Other items |  | (6,401) |  |  |  | (9,096) |
Total deferred income tax liabilities | $ | (430,189) |  |  | $ | (448,818) |
Balance sheet presentation |  |  |  |  |
Deferred income tax assets | $ | 1,915 |  |  | $ | 8,501 |
Deferred income tax liabilities |  | (342,401) |  |  |  | (338,788) |
Deferred income tax liabilities, net | $ | (340,486) |  |  | $ | (330,287) |
(1)The Company receives investment incentive tax credits for qualifying capital expenditures at Çöpler. The application of these tax credits, which are denominated in Turkish Lira, reduced income and mining tax expense and cash tax payments for the year ended December 31, 2022 and are expected to offset future cash tax payments. Reviews of eligible expenditures for tax credits by local tax authorities occur periodically and can result in adjustments to the recognition of investment incentive tax credits. As of December 31, 2022, the Company had deferred tax liabilities related to investments in subsidiaries that were not recognized as the Company controls the dividend policy of its subsidiaries (i.e., the Company controls the timing of reversal of the related taxable temporary differences and is satisfied that they will not reverse in the foreseeable future). It is not practicable to determine the amount of the unrecognized deferred tax liabilities at this time. Valuation of deferred tax assets The Company recognizes tax benefits on losses or other deductible amounts generated in countries where it determines that it is more likely than not that taxable profits will be available to be utilized against those temporary differences. The Company's deferred tax valuation allowance related primarily to tax losses in jurisdictions which do not meet the “more-likely-than-not” standard under current accounting guidance due to insufficient positive taxable income to utilize available tax losses. When there is a change in judgment concerning the recovery of deferred tax assets in future periods, a valuation allowance is recorded into earnings during the quarter in which the change in judgment occurs. The Company has not made any judgement changes with respect to its already established positions. The valuation allowance increased in 2022 by $22.6 million mainly related to an increase in net operating and capital loss carryforwards in entities where the Company does not expect to realize a future tax benefit. Tax loss carryforwards As of December 31, 2022, the Company had the following estimated tax operating and capital losses (in thousands) available to reduce future taxable income, including both losses for which deferred tax assets are utilized to offset applicable deferred tax liabilities and losses for which deferred tax assets have a valuation allowance against. Losses expire at various dates and amounts between 2023 and 2042.
| December 31, 2022 |  | Expiration Year
Mexico | $ | 511 |  |  | 2023-2032
Canada | $ | 179,935 |  |  | 2040-2042
U.S.A. | $ | 7,382 |  |  | 2023-Indefinite
Argentina | $ | 5,692 |  |  | 2026-2027
Türkiye | $ | 7,621 |  |  | 2026-2027
Peru | $ | 263 |  |  | Indefinite
Unrecognized tax benefits The Company records uncertain tax positions on the basis of a two-step process in which (1) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions meeting the “more-likely-than-not” recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits, inclusive of interest and penalties, is as follows during the years ended December 31 (in thousands):
|  | 2022 |  | 2021
Balance as of January 1 |  | $ | — |  |  | $ | — |
Increase associated with tax positions taken during the current year |  |  | — |  |  |  | — |
Increase (decrease) associated with tax positions taken during a prior year (1) |  |  | 9,200 |  |  |  | — |
Settlements |  |  | (626) |  |  |  | — |
Decrease associated with lapses in statutes of limitation |  |  | — |  |  |  | — |
Balance as of December 31 |  | $ | 8,574 |  |  | $ | — |
(1) Of the gross unrecognized tax benefits, $8.6 million were recognized as current liabilities in Condensed Consolidated Balance Sheet as of December, 31, 2022. As of December 31, 2022 and December 31, 2021, $8.6 million and $0, respectively, represent the amount of unrecognized tax benefits, inclusive of interest and penalties that, if recognized, would impact the Company’s effective income tax rate. As of December 31, 2022, the total amount of accrued income-tax-related interest and penalties included in the Condensed Consolidated Balance Sheets was $5.2 million. The Company believes it is reasonably possible that the total amount of the unrecognized tax benefit of $8.6 million will be settled in the next 12 months. During the year ended December 31, 2022, the Company recorded $6.6 million of interest and penalties in Income and mining tax benefit (expense) in the Condensed Consolidated Statements of Operations. No amounts were accrued during the year ended December 31, 2021. The Company files income tax returns in the U.S. federal jurisdiction, Canada, Türkiye, Argentina and various state, provincial and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. Federal, state and local, and non-US income tax examinations for years before 2017. The Company is currently litigating with respect to withholding tax on distributions from its Turkish operation.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI https://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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