We’re ringing in March with an EGP 180 bn package of wage hikes, pension increases, tax breaks: President Abdel Fattah El Sisi announced yesterday a set of measures including public-sector wage hikes, income tax breaks, pension increases, and a 50% rise to the public-sector minimum wage to EGP 6k. The measures aim to alleviate the effects of the ongoing economic crisis on citizens and will come into effect starting next month.

#1- Wage hikes: Starting 1 March, all civil servants and workers at state-owned enterprises will see their monthly salaries increase by EGP 1-1.2k. Meanwhile, the public-sector gross minimum wage will rise by 50% to EGP 6k, from EGP 4k currently.

Remember: This will be the third time the public-sector minimum wage rises in just under a year, and marks a 100% increase from the monthly minimum wage in February 2023. The public-sector minimum wage was last raised in September as part of a wider package of measures aimed at supporting vulnerable households amid soaring inflation.

#2- Income tax break: The government will raise the personal income tax exemption threshold to EGP 60k from EGP 45k currently, reducing wage tax bills paid by employers on mns of public and private-sector employees. The government had raised the exemption to 45k from 36k in September of last year.

#3- Pension increases: Pension payouts will rise 15% for 13 mn pensioners starting the beginning of the month. Pensioners who receive support under the Takaful and Karama program will also see their payout increase 15%.

#4- Better wages for educators, doctors, nurses: The state will spend some EGP 15 bn to increase the wages paid out to doctors, nurses, school teachers, and university faculty.

#5- Early bonuses: Civil servants will receive their bonuses early this year — the payout will range from 10-15% of their monthly salary with a minimum payout of EGP 150. They will also receive one-time bonus payouts of EGP 500-900

The total cost:The measures are expected to cost around EGP 180 bn, the statement said without specifying where the money will come from. The tax cut will cost around 5 bn a year, the pension hike EGP 79.5 bn, and the bonuses EGP 48.5 bn.

The story received attention from: Bloomberg, The National and Reuters.

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