INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2021

INCOME TAXES [Abstract]

Components of (Loss) Profit Before Income Taxes

The components of (loss) profit before income taxes are summarized as follows:

	For the Years Ended December 31,
	2021			2020			2019
PRC	$	(5,477,857	)	$	108,221		$	(13,779,840	)
Non-PRC		(10,943,950	)		(5,305,152	)		(5,725,630	)
Total	$	(16,421,807	)	$	(5,196,931	)	$	(19,505,470	)

Income Tax Expenses

The actual income tax expense reported in the consolidated and combined statements of operations and comprehensive loss for years ended December 31, 2021, 2020 and 2019 differs from the amount computed by applying the PRC statutory income tax rate to income before income taxes due to the following:

	For the Years Ended December 31,
	2021			2020			2019
Loss before provision for income tax	$	(16,421,807	)	$	(5,196,931	)	$	(19,505,470	)
PRC statutory income tax rate		25	%		25	%		25	%
Income tax expense at the PRC statutory rate		(4,105,452	)		(1,299,233	)		(4,876,368	)
Effect of differing tax rates		700,336			91,397			33,047
Effect of non-deductible expenses		396,826			95,659			36,694
Effect of research and development deduction		(204,807	)		(147,155	)		(232,963	)
Effect of valuation allowance		3,213,097			1,259,332			5,039,590
Total income tax expense		-			-			-
Effective income tax rate		0	%		0	%		0	%

Deferred Income Tax Assets

The tax effects of temporary differences that give rise to the deferred income tax assets balances as of December 31, 2021 and 2020 are as follows:

	December 31, 2021			December 31, 2020
Deferred income tax assets:
Employee share option plan expense*	$	-		$	4,981,854
Impairment loss		2,013,232			1,993,546
Tax loss carry forwards		12,646,183			12,097,336
Total deferred income tax assets		14,659,415			19,072,736
Valuation allowance		(14,659,415	)		(19,072,736	)
Deferred income tax assets, net	$	-		$	-

* In connection with the closing of the Combination, each employee stock option outstanding under the Amended 2016 Plan immediately prior to the closing was automatically converted into an option to purchase a number of ordinary shares of CEGL. The Company does not intend to take a tax deduction for the share-based compensation in Australia as the options were granted primarily to China and US employees. Therefore, the related expense was non-deductible for the year ended December 31, 2021, and the prior year deferred income tax asset balance was written off as of December 31, 2021.

Changes Related to Valuation Allowance

The changes related to valuation allowance are as follows:

	For the Years Ended December 31,
	2021			2020		2019
Balance at the beginning of the year	$	19,072,736		$	16,969,593	$	12,020,484
Additions during the year		3,213,097			1,350,729		5,072,637
Expire of NOL		(1,243,653	)		-		-
Write-off of employee stock ownership plans deferred tax asset		(4,981,854	)		-		-
Change in tax rate		(959,106	)		-		-
Company deregistration		(708,266	)		-		-
Exchange rate effect		266,461			752,414		(123,528	)
Balance at the end of the year	$	14,659,415		$	19,072,736	$	16,969,593