Company: GURE
Filing Date: 2025-04-11
Form Type: 10-K
Source: 0001193805-25-000461
Chunk: 319

Company: GULF RESOURCES, INC.
Filing Date: 2025-04-11
Form: 10-K
Item: Item 5
Chunk 319
---
081  
     15,392,874 
  
    Valuation allowance 
     (14,935,081) 
     (13,533,849)
  
    Net deferred tax asset 
    $—  
    $1,859,025 

Deferred tax assets
consist of future reversals of existing taxable temporary differences and adequate future taxable income, exclusive of reversing
deductible temporary differences. As of December 31, 2024 and 2023, valuation allowances were mainly provided against deferred tax
assets caused by exploration costs, Impairment of property plant and equipment, Allowance
and net operating loss where it was determined it was more likely than not that the benefits of the deferred tax assets will not be
realized due to their continuous losses.

The increase in valuation allowance for the year ended
December 31, 2024 is $1,401,232.

The increase in valuation allowance for the year ended
December 31, 2023 is $3,516,915.

There were no unrecognized tax benefits and accrual
for uncertain tax positions as of December 31, 2024 and 2023. There were no amounts accrued for penalties and interest for the years ended
December 31, 2024 and 2023.

There were no change in unrecognized tax benefits during
the years ended December 31, 2024 and 2023.

    F-23 

GULF RESOURCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS

DECEMBER 31, 2024

(Expressed in U.S. dollars)

NOTE 18 – BUSINESS SEGMENTS

Operating segment’s performance
is primarily evaluated based on segment operating income, which excludes share-based compensation expense, certain corporate costs and
other income not associated with the operations of the segment. These corporate costs are separately stated below and also include costs
that are related to functional areas such as accounting, treasury, information technology, legal, human resources, and internal audit.
The Company believes that segment operating income, as defined above, is an appropriate measure for evaluating the operating performance
of its segments. All the customers are located in PRC.

    Year Ended December 31, 2024
                                                                                                                                                                                                    Operating Segment 
    Bromine* 
    Crude Salt* 
    Chemical Products 
    Natural Gas 
    Segment Total 
    Corporate Corporate 
    Total
  
    Net revenue (external