Company: XTKG
Filing Date: 2025-04-25
Form Type: 20-F
Source: 0001213900-25-035626
Chunk: 256

Company: X3 Holdings Co., Ltd.
Filing Date: 2025-04-25
Form: 20-F
Item: Item 19
Chunk 256
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 HOLDINGS CO., LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 15 - Taxes(continued)

PRC

Powerbridge Zhuhai is governed
by the Enterprise Income Tax (“ EIT”) laws of PRC. Under EIT laws of PRC, domestic enterprises and Foreign Investment Enterprises
(the “ FIE”) are usually subject to a unified25% enterprise income tax rate while preferential tax rates, tax holidays and
even tax exemption may be granted on case-by-case basis. EIT grants preferential tax treatment to certain High and New Technology Enterprises
(“ HNTEs”). Under this preferential tax treatment, HNTEs are entitled to an income tax rate of15%, subject to a requirement
that they re-apply for HNTE status every three years. Powerbridge Zhuhai, the Group’s operating subsidiary in PRC, has been approved
as HNTEs in 2014 and successfully renewed it in 2023, which reduced its statutory income tax rate to15%. The rest of the Group’s
subsidiaries in PRC are subject to an income tax rate of25%.

The impact of the preferred tax treatment noted above decreased income
taxes by $286,342, $477,154and $662,675for the fiscal years 2024, 2023 and 2022, respectively. The benefit of the preferred tax treatment
on net loss per share (basic and diluted) was $0.1, $2.4and $139.2for the years ended December 31, 2024, 2023 and 2022, respectively.

Significant components of
the provision for income taxes are as follows:

                          For the years ended December 31,                                                                  
                          2024                                                 2023                    2022                 
 ────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────
  Current                 $                                         ( 411      $            9,354      $         ( 563,650  
  Deferred                                                      ( 122,343                ( 66,695                ( 435,741  
  Income tax benefit      $                                     ( 122,754      $         ( 57,341      $         ( 999,391  

The following table reconciles
China statutory rates to the Group’s effective tax rate:

                                                For the years ended December 31,                                      
                                                                            2024                                      
 ─────────────────────────────────────────