PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2008 and 2007 Expressed in millions of Rupiah, unless otherwise stated
84
27. TAXATION continued b. Tax expense continued
2008 2007
Tax benefitexpense - deferred: Bank Mandiri only
1,936,690 700,116
Subsidiaries 21,960
146
1,958,650 700,262
2,753,244 1,985,892
As explained in Note 2u, income tax for Bank Mandiri and its Subsidiaries is computed for each company as a separate legal entity consolidation is not permitted for corporate income tax filing
purposes.
c. Tax expense - current
The reconciliation between profit before tax benefitexpense as shown in the consolidated statements of profit and loss and income tax computations, and the related current tax expense for
Bank Mandiri and its Subsidiaries is as follows:
2008 2007
Consolidated income before tax expense and minority interests 8,068,560
6,333,383 Less: Income before tax expense of Subsidiaries after elimination
141,244 134,525
Income before tax expense and minority interests - Bank Mandiri only 7,927,316
6,198,858 Adddeduct permanent differences:
Non-deductible expensesNon-taxable income 189,537
52,436 Losses from Hong Kong branch
62,367 -
Others 35,465
15,126 Adddeduct temporary differences:
Over provision for losses on loans 5,897,248
1,933,422 Overunder provision for losses on earning assets
other than loans 840,628
104,899 Over provision for personnel expenses
378,487 506,484
Overunder depreciation of fixed assets 111,736
19,684 Overunder provision for losses arising from legal cases
14,166 22,293
Losses on decrease in market value of securities and Government Recapitalization Bonds
23 14,464
Over provision of repossessed assets -
23,838 Difference in net realizable value of abandoned properties
7,952 486
Overunder provision of abandoned properties 8,105
46,110 Recovery of credit 116,151 90,915
Under provision for estimated losses on commitments and contingencies
154,090 44,209
Estimated taxable income 15,170,675
8,509,224 Estimated tax expense - current
Bank Mandiri only 4,551,185
2,552,750 Subsidiaries
160,709 133,404
Estimated tax expense - current 4,711,894
2,686,154
The amount in 2008 represents loans recovery amounting to Rp116,151 to which the deferred tax impact was not computed. The amount in 2007 represents loans recovery amounting to Rp90,915 to which the deferred tax impact was not computed.
PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2008 and 2007 Expressed in millions of Rupiah, unless otherwise stated
85
27. TAXATION continued c. Tax expense - current continued
Under the Indonesian taxation laws, Bank Mandiri and its Subsidiaries submit tax return on the basis of self assessment. The tax authorities may assess or amend taxes within 5 years after the date of
the tax filings. In September 2008, the Government announced the changes of Law No. 7 Year 1983 regarding
“Income Tax” which will be effective on January 1, 2009 which is Law No. 36 Year 2008 regarding revision for the fourth time of Law No. 7 Year 1983 on Income Tax. The revised Law stipulates
changes in corporate tax rate from a marginal tax rate to a single rate of 28 for fiscal year 2009 and 25 for fiscal year 2010 onwards.
d. Tax expense - deferred
The reconciliation between estimated income tax expense, calculated using applicable tax rates based on commercial income before tax expense, and estimated income tax as reported in the
statements of income for the years ended December 31, 2008 and 2007 are as follows:
2008 2007
Consolidated income before tax expense and minority interests 8,068,560
6,333,383 Less: Income before tax expense of Subsidiaries after elimination
141,244 134,525
Income before tax expense and minority interests - Bank Mandiri only 7,927,316
6,198,858 Estimated income tax expense based on standard statutory rates
2,378,177 1,859,640
Decreaseincrease of deferred tax from changes of taxes rates and recognition of temporary difference not recognized in prior years
184,952 -
Tax effect of permanent differences: Non-deductible expenses
56,861 15,731
Losses from Hong Kong branch 18,710
- Others
10,640 4,537
Recovery of credit 34,845
27,274 236,318
7,006
Tax expense - Bank Mandiri only 2,614,495
1,852,634 Tax expense - Subsidiaries
138,749 133,258
Tax expense - consolidated 2,753,244
1,985,892 Less: Current tax expense - consolidated
4,711,894 2,686,154
Deferred tax benefit - Consolidated 1,958,650
700,262
