Income Tax

12 Months Ended

Dec. 31, 2012

Income Tax [Abstract]

INCOME TAX

NOTE 10 INCOME TAX

Pre-tax income for the years ended December 31, 2012 and 2011 was taxable in the following jurisdictions:

	2012			2011
PRC	$	7,727,981		$	8,603,740
Samoa		6,922,098			2,638,417
BVI		(28,518	)		255,092
Others		88,992			190,000
	$	14,710,553		$	11,687,249

The Company’s operating subsidiaries are governed by the Income Tax Law of the PRC concerning Foreign Investment Enterprises and Foreign Enterprises and various local income tax laws (“the Income Tax Laws”). 

All PRC subsidiaries are subject to income tax at the 25% statutory rate.

Perfect Dream was incorporated in the British Virgin Islands (BVI), and under the current laws of the BVI dividends and capital gains arising from the Company’s investments in the BVI are not subject to income taxes.

Ever-Glory HK was incorporated in Samoa, and under the current laws of Samoa has no liabilities for income taxes.

The following table reconciles the PRC statutory rates to the Company’s effective tax rate for the years ended 2012 and 2011, respectively:

	2012			2011
PRC statutory rate		25.0	%		25.0	%
Non-taxable items		(0.2	)		(0.6	)
Effect of foreign income tax rates		(11.7	)		(6.2	)
Other		(0.1	)		(0.7	)
Effective income tax rate		13.0	%		17.5	%

Income tax expense for the year ended 2012 and 2011 is as follows:

	2012		2011
Current	$	1,165,918	$	707,622
Deferred		741,693		1,332,624
Income tax expense	$	1,907,611	$	2,040,246