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INCOME TAXES
 12 Months Ended
Dec. 31, 2022
Income Tax Disclosure [Abstract]  
INCOME TAXES

NOTE－12 INCOME TAXES

 

The provision for income taxes consisted of the following:

 

   2022   2021   2020 
   Financial Years ended December 31, 
   2022   2021   2020 
   $’000   $’000   $’000 
                
Income tax current year   529    500    137 
Over provision for previous years   -    (270)   - 
Deferred tax   -    -    (134)
                
Income tax expense   529    230    3 

 

The effective tax rate in the years presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rate. The Company’s subsidiaries mainly operate in Singapore that are subject to taxes in the jurisdictions in which they operate, as follows:

 

BVI

 

MWE is considered to be an exempted British Virgin Islands Company and are presently not subject to income taxes or income tax filing requirements in the British Virgin Islands or the United States.

 

Singapore

 

Multi Ways SG is operating in Singapore and are subject to the Singapore tax law at the corporate tax rate at 17% on the assessable income arising in Singapore during its tax year.

 

 

The reconciliation of income tax rate to the effective income tax rate based on income before income taxes for the financial years ended December 31, 2022, 2021 and 2020 are as follows:

 

   $’000   $’000   $’000 
   Financial Years ended December 31, 
   2022   2021   2020 
   $’000   $’000   $’000 
             
Income before income taxes   1,557    2,031    1,322 
Statutory income tax rate   17%   17%   17%
Income tax expense at statutory rate   265    345    225 
Tax effect of non-taxable income   (62)   -    (144)
Tax effect of non-deductible items   339    156    61 
Tax refund   -    (263)   - 
Tax holiday   (13)   (8)   (139)
                
Income tax expense   529    230    3 

 

The following table sets forth the significant components of the deferred tax assets and liabilities of the Company as of December 31, 2022 and 2021:

  

          
   As of December 31, 
   2022   2021  
   $’000   $’000  
          
Deferred tax asset:           
Accelerated tax depreciation   8    8  

 

Uncertain tax positions

 

The Company evaluates the uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of December 31, 2022 and 2021, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income tax expenses for the financial years ended December 31, 2022, 2021 and 2020 and also did not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from December 31, 2022.