Company: GURE
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001193805-25-001184
Chunk: 33

Company: GULF RESOURCES, INC.
Filing Date: 2025-08-13
Form: 10-Q
Item: Item 1
Chunk 33
---
5
and 2024.

    (c)
    Hong Kong
  
Hong Kong

HKJI, a subsidiary of Upper Class Group Limited, was
incorporated in Hong Kong and is subject to Hong Kong taxation on its activities conducted in Hong Kong and income arising in or derived
from Hong Kong.  No provision for income tax has been made as it has no taxable income for the three-month and six-month periods
ended June 30, 2025 and 2024.  The applicable statutory tax rates for the three-month and six-month periods ended June 30, 2025
and 2024 are 16.5%. There is no dividend withholding tax in Hong Kong.

    (d)
    PRC
  
PRC

Enterprise income tax (“EIT”) for SCHC, SYCI, SHSI and
DCHC in the PRC is charged at 25% of the assessable profits.

The operating subsidiaries SCHC, SYCI, and DCHC are wholly foreign-owned
enterprises (“FIE”) and SHSI incorporated in the PRC and are subject to PRC Local Income Tax Law. The PRC tax losses may be
carried forward to be utilized against future taxable profit for ten years for High-tech enterprises and small and medium-sized enterprises
of science and technology and for five years for other companies. Tax losses of the operating subsidiaries of the Company may be carried
forward for five years.

On February 22, 2008, the Ministry of Finance
(“MOF”) and the State Administration of Taxation (“SAT”) jointly issued Cai Shui [2008] Circular 1 (“Circular
1”). According to Article 4 of Circular 1, distributions of accumulated profits earned by a FIE prior to January 1, 2008 to foreign
investor(s) in 2008 will be exempted from withholding tax (“WHT”) while distribution of the profit earned by an FIE after
January 1, 2008 to its foreign investor(s) shall be subject to WHT at 5% effective tax rate.

    19 

GULF RESOURCES, INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2025

 (Expressed in U.S. dollars)

(UNAUDITED)

As of June 30, 2025 and December 31, 2024,