Entity information:

11.       INCOME TAXES

 

The components of loss before income taxes are as follows:

    2017   2016
Domestic     (5,331,597 )     (1,411,971 )
Foreign     (10,082,600 )     (9,549,369 )
Loss before income tax     (10,961,340 )     (10,961,340 )

Income taxes relating to the Company’s operations are as follows:

      2017       2016  
Current income taxes                
US Federal, state and local     —         —    
Foreign     —         —    
Deferred income taxes     —         —    
US Federal, state and local     —         —    
Foreign     —         —    
Income tax expense/recovery     —         —    

 

Income taxes at the United States federal statutory rate compared to the Company’s income tax expenses as reported are as follows: 

    2017   2016
Net loss before income tax     (15,414,197 )     (10,961,340 )
     Statutory rate     35 %     35 %
Expected income tax recovery     (5,394,969 )     (3,836,469 )
Impact on income tax expense/recovery from                
Change in valuation allowance     4,534,893       3,518,283  
Different tax rates in foreign jurisdictions     737,692       921,953  
Expiration of unused tax loss carry forwards     1,148,939       502,483  
Permanent differences     1,214,999       (645,752 )
Difference due to tax review / previous year adjustments     (2,270,718 )     (317,710 )
Others     29,164       (142,789 )
Income tax expense     —         —    

 

The Company’s deferred tax assets and liabilities consist of the following: 

    December 31, 2017   December 31, 2016
Deferred tax assets                
Tax loss carry forward     25,935,845       20,370,022  
Valuation allowance     (25,935,845 )     (20,370,022 )
Deferred tax assets/liabilities     —         —    

 

As of December 31, 2017 and 2016, there were no known uncertain tax positions. We have not identified any tax positions for which it is reasonably possible that a significant change will occur during the next 12 months.

Pursuant to ASC 740-10-25-3 Income Taxes, an income tax provision has not been made for U.S. or additional foreign taxes since none of the subsidiaries of the Company are generating income nor are expected to in the foreseeable future. The company expects that future earnings will be reinvested, but could become subject to additional tax if they were remitted as dividends or were loaned to the Company, or if the Company should sell or dispose of its stock in the foreign subsidiaries. It is not practical to determine the deferred tax liability, if any, that might be payable on foreign earnings because if the Company were to repatriate these earnings, the Company believes there would be various methods available to it, each with different U.S. tax consequences.

The Company’s operating loss carry forward of all jurisdictions expire according to the following schedule: 

  Domestic   Foreign
2018   —         8,402,020  
2019   —         4,911,524  
2020   —         2,725,174  
2021   —         8,019,852  
2022   —         13,870,585  
2023   392,931       14,008,335  
2024   240,753       13,011,460  
Beyond 2024   26,268,661       0  
Total operating loss carry forwards $ 26,902,345       64,948,950  

 

The following tax years remain subject to examination:

    United States of America     Switzerland     Costa Rica*
2008   YES     NO     N/A
2009   YES     NO     N/A
2010   YES     NO     N/A
2011   YES     NO     N/A
2012   YES     NO     N/A
2013   YES     NO     NO
2014   YES     NO     NO
2015   YES     YES     NO
2016   YES     YES     NO
2017   YES     YES     YES

 

* The Costa Rican companies are taxable since 2013.