25.  Income taxes

The components of income tax expense (recovery) are as follows:

		Year ended			Year ended
		December 31,			December 31,
		2025			2024
Current income tax expense	$	4,935		$	1,712
Deferred income tax recovery		(312	)		(1,033	)
Income tax expense	$	4,623		$	679

The Company's effective rate of income tax differs from the statutory rate of 26.5% as follows:

		Year ended			Year ended
		December 31,			December 31,
		2025			2024
Loss before income taxes	$	(82,823	)	$	(48,325	)
Statutory rate		26.5%			26.5%
Tax recovery at statutory rate		(21,948	)		(12,806	)
Mexican mining royalty		1,655			84
Impact of foreign tax rates		185			(31	)
Non-deductible expenses		4,931			3,544
Losses not recognized		19,800			9,888
Income tax expense (recovery)	$	4,623		$	679

 

The Company's net deferred tax liability relates to the Mexican mining royalty and arises principally from the following:

		December 31,			December 31,
		2025			2024
Property, plant and equipment	$	130		$	130
Other		400			313
Total deferred tax liabilities		530			443
Provisions and reserves		(517	)		(395	)
Net deferred tax liabilities	$	13		$	48

Deferred income taxes have not been recognized in respect of the following deductible temporary differences, as management does not consider their utilization to be probable for the foreseeable future:

		December 31,			December 31,
		2025			2024
Property, plant and equipment	$	14,910		$	24,680
Mexican tax losses (expiring in 2026 - 2035)		46,540			32,000
Canadian tax losses (expiring in 2034 - 2045)		67,150			44,900
U.S. tax losses (no expiry)		13,100			32,150
Provisions and other		53,157			91,012
Deferred Mexican mining royalty		13			48
	$	194,870		$	224,790

Canadian tax losses include a dual Canadian and U.S. resident entity with $26.2 million in losses (2024: $20.8 million).