Finance Ministry reduces VAT on imported capital goods to 5%

The Finance Ministry has cut the value-added tax on imports of machinery, equipment, and capital goods to 5%, effective immediately, according to a statement from the ministry. The tax cut also applies to production lines that are imported either in parts or already assembled. Finance Minister Amr El Garhy says the exceptional rate reduction decision was taken after noticing problems in implementing the VAT law and to support domestic production and national mega projects. El Garhy says measures have been put in place to ensure this rate reduction is used to support expanding production domestically and not as a loophole for tax avoidance.