Income Taxes

9 Months Ended

Sep. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Note 11 — Income taxes

The source of pre-tax income and the components of income tax expense are as follows:

	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2022		2021		2022		2021
	USD		USD		USD		USD
Income components
United States	$	370,822	$	(774,534)	$	461,022	$	262,433
Outside United States		1,210,493		2,402,082		3,334,100		7,918,241
Total pre-tax income	$	1,581,315	$	1,627,548	$	3,795,122	$	8,180,674
Provision for income taxes
Current
Federal	$	9,563	$	—	$	25,850	$	—
State		840		(11,111)		8,916		(3,274)
Foreign		244,514		267,188		689,950		1,092,881
		254,917		256,077		724,716		1,089,607
Deferred
Federal		38,456		8,839		69,077		250,606
State		12,241		(33,182)		24,905		(24,668)
Foreign		3,559		—		3,559		—
		54,256		(24,343)		97,541		225,938
Total provision for income taxes	$	309,173	$	231,734	$	822,257	$	1,315,545

Reconciliations between taxes at the U.S. federal income tax rate and taxes at the Company’s effective income tax rate on earnings before income taxes are as follows:

	For the Nine Months Ended
	September 30,
	2022		2021
Federal statutory rate	21.0	%	21.0	%
(Decrease) increase in tax rate resulting from:
State and local income taxes, net of federal benefit	0.6		(0.1)
Foreign operations	(0.2)		(7.0)
Permanent items	0.2		(4.2)
Deferred rate changes	—		—
Foreign dividends and earnings taxable in the United States	—		2.1
Others	0.1		4.3
Effective tax rate	21.7	%	16.1	%

The following is a summary of the components of the net deferred tax assets and liabilities recognized in the consolidated balance sheets:

	As of		As of
	September 30, 2022		December 31, 2021
	USD		USD
Deferred tax assets
Allowance for doubtful accounts	$	70,078	$	44,368
Other reserve		148,013		144,794
Accrued expenses		107,597		134,576
Lease liability		1,572,608		1,749,430
Charitable contributions		8,565		8,565
Business interest limitation		405,255		385,084
Net operating loss – federal		530,302		633,700
Net operating loss – state		103,379		128,569
Other		45,499		60,171
Total deferred tax assets		2,991,296		3,289,257
Less: valuation allowance		—		—
Net deferred tax assets		2,991,296		3,289,257
Deferred tax liabilities
Fixed assets		1,621,359		1,799,996
Intangibles		—		10,672
Total deferred tax liabilities		1,621,359		1,810,668
Deferred tax assets, net of deferred tax liabilities	$	1,369,937	$	1,478,589

The deferred tax assets related to the Company’s net operating losses of $4,212,179 and $5,150,646 for September 30, 2022 and December 31, 2021. The Federal Net Operating losses have no expiration date.