XMH Holdings Ltd. said its wholly owned Indonesian subsidiary, PT Xin Ming Hua Engine, has been informed that the country’s tax authority has rejected the company’s objections to most parts of a tax assessment for the financial year ended Apr, 30 2024.

The disputed assessment totals about 143.9 billion Indonesian rupiah, or roughly 13 million Singapore dollars. Rejections cover the full corporate income-tax component of about IDR 18.5 billion (S$1.7 million) and the full withholding-tax component of about IDR 10.3 billion (S$0.9 million), as well as IDR 40.3 billion (S$3.6 million) of value-added tax for the period Jan 1 to Apr 30 2024.

A remaining VAT item of IDR 74.8 billion (about S$6.8 million) for May 1 2023 to Dec 31 2023 is still under review. PT Xin Ming Hua Engine intends to file formal tax appeals once the authority issues its decision on this outstanding component.

XMH warned that if the full amounts assessed become payable, the charges would have a material impact on the group’s earnings for the current financial year. The company said it will release further updates in line with Singapore Exchange listing rules.