Annual Report 2022

130 China Merchants China Direct Investments Limited Annual Report 2022 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 12. TAXATION (CONTINUED) The tax credit (charge) for the year can be reconciled to the (loss) profit before taxation per the consolidated statement of profit or loss and other comprehensive income as follows: 2022 2021 US$ US$ (Loss) profit before taxation (196,387,262) 43,020,768 Tax at the domestic income tax rate of 25% (2021: 25%) (Note) 49,096,816 (10,755,192) Tax effect of expenses not deductible for tax purpose (4,562,342) (4,505,864) Tax effect of income not taxable for tax purpose 5,524,990 3,031,736 Tax effect of tax losses not recognised (2,698,341) (365) Utilisation of tax losses not recognised 583,143 2,243,008 Utilisation of deductible temporary difference previously not recognised 2,471,715 — Withholding tax for undistributed earnings of PRC subsidiaries 5,684,635 (2,769,098) Withholding tax for distributed earnings (1,322,341) (1,908,006) Effect of different tax rates of the Company and its subsidiaries operating in other regions in the PRC (11,561,432) (4,151,620) Taxation 43,216,843 (18,815,401) Note: The domestic tax rate (which is PRC Enterprise Income Tax rate applicable to the Company’s major subsidiaries in the PRC) represents the tax rate in the jurisdiction where the investments of the Group are substantially located. 13. DIVIDENDS Subsequent to the end of the reporting period, a final dividend of US$0.07 per share (2021: a final dividend of US$0.07 per share and a special dividend of US$0.07 per share, totaling US$0.14 per share), in an aggregate amount of US$10,663,311 (2021: US$21,326,622), in respect of the year ended 31 December 2022 (2021: year ended 31 December 2021), has been proposed by the Directors and is subject to approval by the shareholders at the forthcoming annual general meeting. Final and special dividends of US$21,326,622 (2021: final and special dividends of US$12,186,641) for the year ended 31 December 2021 (2021: year ended 31 December 2020) were paid in cash on 27 July 2022 (2021: 27 July 2021).