Income Taxes

12 Months Ended

Dec. 31, 2022

(a)Reconciliation of income taxes

A reconciliation of the income tax expense to the amount calculated using the Company’s combined Canadian federal and provincial statutory income tax rate of 27% (2021 – 27%) is as follows:


	Year ended December 31,
	2022			2021
Net income in the year before tax	$	126,383		$	236,920
Tax rate	27		%	27		%
Income tax expense at statutory rate	$	34,123		$	63,968
Tax effect of:
Difference in tax rate of foreign jurisdictions	(15,858)			(29,888)
Non-taxable items	(5,618)			(7,465)
Change in temporary differences not previously recognized	8,762			6,618
Other	1,907			1,055
Income tax expense	$	23,316		$	34,288


	Year ended December 31,
	2022		2021
Current income tax:
Relating to current income tax charge	$	15,043	$	22,428
Deferred income tax:

Relating to origination and reversal of temporary differences	8,273		11,860
Income tax expense recognized in net income	$	23,316	$	34,288
Income tax expense recognized in other comprehensive income	523		576
Total income tax expense	$	23,839	$	34,864

(b)Deferred income tax liabilities

The general movement in the deferred income tax liabilities is as follows:


	Year ended December 31,
	2022		2021
At the beginning of the year	$	2,315	$	14,223
Deferred income tax expense	(8,273)		(11,860)
Income tax expense recognized in OCI	(523)		(576)
Foreign exchange	252		528
At the end of the year	$	(6,229)	$	2,315

Recognized deferred tax and assets and liabilities consist of the following:


	December 31, 2022		December 31, 2021
Deferred tax assets:
Non-capital losses	$	2,546	$	2,905
Foreign exchange	2,087		8,458
Other	5,407		3,698
Mine closure and rehabilitation provision	3,381		2,903
	13,421		17,964
Deferred tax liabilities:
Mineral property, plant and equipment	(6,599)		(4,986)
Loans and borrowings	(9,321)		(8,775)
Other	(1,199)		(618)
Loans and borrowings	(2,531)		(1,270)
	(19,650)		(15,649)

Net deferred income tax (liabilities) assets	$	(6,229)	$	2,315

Deferred tax assets of $30.4 million (December 31, 2021 - $21.4 million) have not been recognized for the following deductible temporary differences as it is not probable that the benefits of these temporary differences will be realized:


	Year ended December 31, 2022				Year ended December 31, 2021
	Brazil		Canada		Brazil		Canada
Exploration and evaluation assets	$	37,077	$	—	$	34,660	$	—
Mineral property, plant and equipment	—		969		—		922
Non-capital losses	—		72,535		—		44,521
Other	—		18,100		—		16,213
	$	37,077	$	91,604	$	34,660	$	61,656

At December 31, 2022, the Company had no loss carry forwards in Brazil (December 31, 2021 - $7.7 million) which can be carried forward indefinitely to offset future taxable income in Brazil. Use of losses carry forwards is limited to 30% of taxable income annually. The Company also had loss carry forwards in Canada totaling $82.0 million (December 31, 2021 - $48.0 million) which may be carried forward for 20 years to offset future taxable income, which expire between 2036 and 2042.