XML 24 R14.htm IDEA: XBRL DOCUMENT v3.5.0.2
Income Taxes
 6 Months Ended
Jun. 30, 2016
Income Tax Disclosure [Abstract]  
Income Taxes

Note 8. Income Taxes

 

The Company files income tax returns for TG and ES in the Republic of Colombia. Colombia’s Tax Statute was reformed in December 2014. A general corporate income Tax Rate applies at 25% and a CREE Tax based on taxable income applies at a rate of 9% to certain taxpayers including the Company. Prior to the reform, the CREE Tax would only apply up to tax years 2015. The reform makes the CREE tax rate of 9% permanent and an additional CREE Surtax will apply for the years 2015 through 2018 at varying rates.

 

The following table summarizes income tax rates under the tax reform law:

 

    2015     2016     2017     2018     2019  
Income Tax     25 %     25 %     25 %     25 %     25 %
CREE Tax     9 %     9 %     9 %     9 %     9 %
CREE Surtax     5 %     6 %     8 %     9 %     -  
Total Tax on Income     39 %     40 %     42 %     43 %     34 %

 

The components of income tax expense (benefit) are as follows:

 

    Three months ended June 30,     Six months ended June 30,  
    2016     2015     2016     2015  
Current income tax                                
Foreign   $ 4,406     $ 4,328     $ 7,662     $ 9,257  
Deferred income tax                                
Foreign     (591 )     (697 )     (204 )     (854 )
Total Provision for Income tax   $ 3,815     $ 3,631     $ 7,458     $ 8,403  
                                 
Effective tax rate     21.0 %     -20.9 %     21.0 %     -1,143.3 %

 

The Company’s effective tax rates for the three-month periods ended June 30, 2016 and 2015 reflect the non-cash, non-deductible losses and non-taxable gains from changes in the fair values of the Company’s warrant and earnout shares liabilities in the table below:

 

    Three months ended June 30,     Six months ended June 30,  
    2016     2015     2016     2015  
Change in fair value of warrant liability   $ 6,687     $ (16,391 )   $ 12,598     $ (11,313 )
Change in fair value of earnout shares liability     3,330       (9,653 )     7,034       (7,672 )
Total non-cash, nontaxable effects of changes in fair value of liabilities   $ 10,017     $ (26,044 )   $ 19,632     $ (18,985 )

 

In addition, the Company’s statutory tax rate increased from 39% in 2015 to 40% in 2016 because of the tax reform mentioned above.