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A reconciliation between the tax expense reported and the product of accounting profit multiplied by the applicable taxrate is as follows :Group2006 2005$’000 $’000Profit before tax and gain from enbloc property sales and impairment loss 217,983 183,449Tax at the rates applicable 43,597 36,690Write-back of provisions for properties heldfor sale not subject to tax (9,495) (3,432)Deferred tax write-back, net of provision (8,205) (5,863)Losses not deductible for tax purposes 13,085 16,644Expenses not deductible for tax purposes 2,319 1,562Utilisation of capital allowances and losses (1,243) (1,864)Different tax rates in other jurisdictions 14,615 12,421Non-taxable income (7,128) (13,729)Others 219 (5,396)Current year’s tax expense 47,764 37,033The statutory income tax rate applicable to Singapore Group companies for Year of Assessment 2007 is 20% (Year ofAssessment 2006 : 20%).Under the group tax relief system introduced by the Inland Revenue Authority of Singapore (“IRAS”), a Singaporeincorporated company may, upon satisfaction of the criteria set out by IRAS, transfer its current year’s unabsorbed capitalallowances, trade losses and donations to another company belonging to the same group, to be deducted against theassessable income of the latter company. The loss so utilized is recognised as a deferred tax asset in the accounts of thetransferor company.Net Tax ProvisionGroupCompany2006 2005 2006 2005$’000 $’000 $’000 $’000Provision for taxation 100,758 67,728 1,458 882Income tax refund receivable (14,380) (8,989) - -86,378 58,739 1,458 882Subject to Sections 23 and 37 of the Income Tax Act, Cap 134, the Group has certain unutilised tax losses of$363,004,000 (2005: $318,741,000) and capital allowances of $8,002,000 (2005: $3,322,000) at 31 December 2006 forwhich related tax benefits totalling $74,201,000 (2005: $64,413,000) have not been included in the accounts. The taxlosses are available for offset against future taxable profits of the companies in which the losses arose but for whichno deferred tax asset has been recognised due to uncertainty of their recoverability.Notes to the financial statementsKeppel Land LimitedReport to Shareholders 2006193