Country Trading Profiles Egypt - Taxes

Tax Rates

Nature of the tax: A "General Sales Tax (GST)" apply.
Tax rate: The GST (General Sales Tax) rate is 10%, except for some products :
- 25% to televisions, radios, jewellery and certain motors vehicles;
- 30% to luxury goods such as cosmetics, video cameras, and high-value vehicle.
Reduced tax rate: Reduced rates of 5% or 10%, depending on their type :
- 5% to some foodstuffs, fertilisers and locally produced medicines ;
- 10% to hotel and tourism services, specific international communications and certain services.
Other consumption taxes: Excise duty is also collected on alcoholic drinks and coffee. An additional duty is collected on brandy, cognac, gin and whisky.

Legal Entity Income Tax	Income below EGP 10 million: 20% Income exceeding EGP 10 million: 25%
Tax on the Canal de Suez operator Profits	40%
For oil and gas companies	40.55%

Tax rate for foreign companies: For additional information on consumption tax for non-resident access the PKF tax guide on Egypt.
Capital gains taxation: Long-term capital gains are subject to tax on the companies at the standard rate (20%). Profits from movable capital are not taxable.
Main allowable deductions and tax credit: Setting up in special economic zones entitles the company to tax benefits. They are only taxed at 1% of their profits or operations. For additional information access the PKF tax guide on Egypt.
Other corporate taxes: A tax on real-estate assets has been put in place in June 2008. It is up to 10% of the rental value whether the property is rented out or not. If the property is rented, the rental value is the effective value of rent collected by the owner if it is higher than 7% of the purchase value. The owner is exempted from landed property if the value of the property is less than or equal to EGP 500,000.

Allowable deductions and tax credit: Deductible Costs:
- Pension scheme amounts;
- Life and heath insurance.
Special expatriate tax regime: No special tax regime for expatriates.

Countries with whom a double taxation treaty have been signed: Refer to the list of International tax convention
Withholding taxes: Interest: 20%, Royalties: 20%
Bilateral agreement

Tax year: The fiscal year starts on January 1st and ends on December 31st the same year.
Accounting standards: The accounting obligations result from the Companies Act no. 159 of 1981 and Financial Market and Money Market Act no. 95 of 1992. The Accounting Plan (the Egyptian accounting standards) is close to international accounting standards.
Accounting regulation bodies: EFSA
Accounting reports: According to the law, all companies must present to the shareholders during their annual meeting an audit report, a balance sheet, an income statement and cash flow statement.
Publication requirements: After its initial public offering, the company must present every three months a detailed report of its business (business progress and results).
Each year, a progress report and a report of the accounts (before certification) must be sent to the Capital Market Authority one month after the fiscal year end at the latest. The certified accounts cited on the Official Schedule 1 must be published in two reference journals of which at least one must be in the Arabic language.
Professional accountancy bodies: Egyptian Society of Accountants and Auditors (ESAASC)
Certification and auditing: All the accounts and reports are likely to be verified by government authorities such as the Tax Department (Internal Revenue) or the corporate department of the Department of Economy and Industry.
Accounting news: Economics and Accounting News website