Annual Report 2011 - Mandarin Oriental Hotel Group

5 Tax
Annual Report 2011 51
2011 2010
US$m US$m
Tax charged to profit and loss is analyzed as follows:
– Current tax 10.4 7.5
– Deferred tax (refer note 13) 8.6 4.5
19.0 12.0
Analysis by geographical area
– Hong Kong 11.4 8.6
– Other Asia 2.6 (0.5 )
– Europe 5.0 3.6
– The Americas – 0.3
19.0 12.0
Analysis by activity
– Hotel ownership 13.9 6.3
– Hotel management 5.1 5.7
19.0 12.0
Reconciliation between tax expense and tax at the applicable tax rate*:
Tax at applicable tax rate 5.5 5.6
Income not subject to tax (3.4 ) (0.3 )
Expenses not deductible for tax purposes 2.7 1.9
Tax losses not recognized 12.4 5.3
Recognition of previously unrecognized temporary differences 0.9 0.6
Deferred tax liabilities written back – (2.6 )
Withholding tax 1.2 1.3
(Over)/under provision in prior years (0.5 ) 0.1
Others 0.2 0.1
19.0 12.0
Tax relating to components of other comprehensive income is analyzed as follows:
Actuarial valuation of employee benefit plan 1.0 (0.3 )
Revaluation of other investments – 0.1
Cash flow hedges 0.1 0.5
1.1 0.3
Share of tax of associates and joint ventures of US$4.4 million (2010: US$5.1 million) are included in share of results of
associates and joint ventures (refer note 4).
* The applicable tax rate for the year was 7% (2010: 11%) and represents the weighted average of the rates of taxation prevailing in the
territories in which the Group operates. The decrease in applicable tax rate was caused by a change in the geographical mix of the Group’s
profitability and a reduction in the income tax rate in the United Kingdom.