Note 8 - Income Taxes

The income tax provision differs from the amount of tax determined by applying the US federal statutory rate of 35% as follows:

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income taxes.

Net deferred tax assets and liabilities are comprised of the following:

The US parent entity´s expenses are funded by the foreign subsidiaries through a management fee, which is, included in the US parent´s unconsolidated US annual income tax return as taxable revenues.

The Company has not recorded deferred income taxes applicable to undistributed earnings of the foreign subsidiaries because there are cumulative losses in those subsidiaries through December 31, 2016. In the future, the Company does not intend to record deferred income taxes applicable to undistributed future earnings of the foreign subsidiaries because it is the present intention of management to reinvest the undistributed earnings indefinitely in those foreign subsidiaries.

In assessing the realizability of deferred tax assets, management considers that whether it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. As of December 31, 2016 and 2015, based upon the levels of historical taxable income and the limited experience of the Company, the Company believes that it is more-likely-than-not that it will not be able to realize the benefits of some or all of these deductible differences. Accordingly, a valuation allowance of approximately $(108,904) and $(66,190) has been provided in the accompanying financial statements as of December 31, 2016 and 2015, respectively.

At December 31, 2016, the Company had approximately $311,000 of net operating loss carry-forwards that will expire through 2036.

The Company is not subject to any foreign income taxes for the years ended December 31, 2016 and 2015. The Company may be subject to examination by the Internal Revenue Service (“IRS”) and state taxing authorities for the 2014, 2015 and 2016 tax years.