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28. Income taxes

Major components of tax expenses/(income)
in thousand EUR   2021   2020
Current tax expenses/(income)   1 598   699
Deferred tax expenses/(income) relating to temporary differences   1 665   412
Total income taxes   3 263   1 111
Reconciliation of tax expenses/(income)
in thousand EUR   2021   2020
Earnings before tax   7 949   –1 070
Expected tax expenses/(income) based on a weighted average   2 371   –147
Derecognition of previously recognized deferred tax assets   1 138   759
Minimum tax in Gabon   345   434
Change in permanent differences   –568   7
Non-deductible expenses     58
Other   –23  
Total income taxes   3 263   1 111

The weighted average applicable tax rate, considering all profit- and loss-making entities, was 28 % (2020: 28 %).

Deferred income tax
in thousand EUR   2021   2020
Total deferred tax assets   9 873   9 950
Total deferred tax liabilities   –17 422   –16 164
Net deferred tax assets/(liabilities)   –7 549   –6 214

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset them and when the deferred income taxes relate to the same tax authority.

Deferred income tax assets
in thousand EUR   2021   2020
Inventories   26   27
Tax loss carry-forwards   1 234   1 747
Provisions   138   113
Financial liabilities   7 764   7 348
Other   711   715
Total deferred tax assets   9 873   9 950
Deferred income tax liabilities
in thousand EUR   2021   2020
Property, plant and equipment   –12 336   –12 481
Biological assets   –4 881   –3 455
Intangible assets   –205   –228
Total deferred tax liabilities   –17 422   –16 164
 
Net deferred tax assets/(liabilities)   –7 549   –6 214
Reported in the balance sheet as follows:        
Deferred tax assets    
Deferred tax liabilities   –7 549   –6 214
Net deferred tax assets/(liabilities)   –7 549   –6 214

Net movement of the deferred income tax account is as follows:

in thousand EUR   2021   2020
At 1 January   –6 214   –12 928
Income statement charge   –1 665   –412
Tax charged to other comprehensive income   389   3 996
Currency effects   –59   3 130
At 31 December   –7 549   –6 214

The Group did not recognize deferred income tax assets on deductible temporary differences of EUR 5.7 million (2020: EUR 4.6 million) and on unused tax losses of EUR 40.5 million (2020: EUR 43.5 million).

These unrecognized tax loss carry-forwards expire as presented in the table below:

in thousand EUR   2021   2020
0–2 years   26 218   36 668
3–4 years     954
5–7 years   6 868   2 681
over 7 years   7 369   3 237
Total tax loss carry-forwards   40 455   43 540

EUR 5.4 million of these tax loss carry-forwards belong to the Dutch operations of Precious Woods with an applicable tax rate of 15 % (2020: EUR 9.0 million with an applicable tax rate of 19 %), EUR 3.3 million belong to the Brazilian operations with an applicable tax rate of 34 % (2020: EUR 3.2 million with an applicable tax rate of 34 %), and EUR 31.8 million belong to the Swiss operation with an applicable tax rate of 11.85 % (2020: EUR 31.3 million with an applicable tax rate of 11.91 %). From the Gabonese operations no tax loss carry-forwards remain from 2020 (2020: EUR 0.0 million).

Accounting policies

The charge for current income tax is based on the results for the year as adjusted for items which are non-assessable or disallowed. It is calculated using tax rates for the countries where the Group has operations. Deferred income taxes are accounted for using the balance sheet liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements, and the corresponding tax basis used in the computation of taxable profit. Deferred income tax liabilities are generally recognized for all taxable temporary differences, and deferred income tax assets are generally recognized for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilized. Such assets and liabilities are not recognized if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction, which, at the time of the transaction, affects neither the taxable profit nor the accounting profit.