Good afternoon, friends, and congratulations on wrapping up another workweek — one more to go before a well-deserved break.

It’s official — the public sector will take a five-day break from Thursday, 5 June through Monday, 9 June in observance of Eid Al Adha, Prime Minister Moustafa Madbouly announced today. The Labor Ministry and the central bank are yet to announce the dates for the private and the banking sectors. Exams, if any, will continue as scheduled according to the dates set by the relevant authorities.

THE BIG STORY TODAY-

Tax exemption threshold for privately-owned houses has been doubled to EGP 4 mn, a government source told EnterpriseAM, after the Madbouly government greenlit the Property Tax Law amendments in its weekly meeting yesterday.

We already knew this was coming: A senior government official confirmed to us in March that the Finance Ministry was looking to amend the property tax law to raise the exemption threshold to EGP 4-5 mn, up from EGP 2 mn currently, in light of rising property prices and inflation. A few months earlier, Deputy Finance Minister for Tax Policy Sherif Al Kilani told us that the current exemption threshold became “outdated due to inflation and rising property prices.” He added that the ministry was considering either raising the cap or exempting private family residences entirely, while taxing additional properties.

Some 30% of the unit's value has been deducted for maintenance and to account for developments in the real estate market, to ease the burden on citizens, the source said. An automated unified real estate tax platform is currently on trial. The platform will allow real estate units to be registered and taxpayers can submit a unified file for all real estate holdings without being restricted to the geographical location of the residential or administrative unit.

The first phase of the property tax changes will focus on 10 urban areas expected to bring in the greatest chunk of targeted revenues, including the New Administrative Capital, the North Coast, Sheikh Zayed, and the Fifth Settlement, before expanding nationwide, according to the source. Residential compounds are expected to account for 450k units out of a total of 45 mn housing units, that are estimated to shape Egypt’s real estate wealth, given the lack of an accurate inventory, according to the source.

The Finance Ministry has confirmed plans by the government to offer stakes in 11 state-owned companies in FY 2025-2026 as part of the country’s privatization program, according to its latest monthly financial report (pdf). The announcement aligns with statements by government sources who told EnterpriseAM earlier this month that the state aims to raise USD 4-5 bn through stake sales in 11 companies by the end of the upcoming fiscal year.

ICYMI- The lineup includes five military-affiliated firms. The Sovereign Fund of Egypt is restructuring five companies affiliated with the military’s National Service Projects Organization to list them on the EGX before 2026. These include filling station operator Wataneya, bottled water company Safi, food manufacturer Silo Foods, fuel retailer Chill Out, and the National Roads Company.

Private sector investment is picking up: Private investment grew 35.4% y-o-y in 2Q FY 2024-2025, accounting for 53.3% of the total investments, according to the report. Meanwhile, public investment fell 25.7% y-o-y during the quarter — aligning with the state’s strategy to hand more of the economic reins to the private sector.

THE BIG STORY ABROAD-

Financial markets cheered the US trade court’s ruling against Trump tariffs: S&P 500 futures rose nearly 1%, while the USD rallied 0.2% against the JPY and 0.3% against the CHF after the US Court of International Trade blocked US President Donald Trump’s Liberation Day tariffs on dozens of countries. The ruling, which found that Trump had overstepped his authority, benefited sectors hit hardest by tariff disruptions including chipmakers, banks, luxury goods, and automakers.

But the road ahead remains uncertain: “While volatility has eased for now, the lack of clarity” around whether the Trump administration will comply “could reignite market turbulence,” Grasshopper Asia CEO James Leong told Reuters. “Until the Supreme Court provides a definitive ruling, we're unlikely to see a lasting resolution,” he added. Following the ruling yesterday, the administration immediately said it will appeal.

MEANWHILE- Israel announced a major invasion of the occupied West Bank with plans to establish 22 new settlements, marking the largest expansion in years, according to the Financial Times. Defense Minister Israel Katz described this as a “strategic move that prevents the establishment of a Palestinian state that would endanger Israel, and serves as a buffer against our enemies. This is a Zionist, security, and national response — and a clear decision on the future of the country.”

This “decisive response” to Palestinian “militancy” comes hot on the heels of escalating Israeli airstrikes, which have killed at least 55 people yesterday, and over 600 this week. The salmon-colored newspaper reports that this escalation is “likely to increase international condemnation of [Israel].”

The Israeli government also confirmed the death of Mohammed Sinwar, the brother and successor of deceased leader Yahya Sinwar, confirming earlier international reports.

☀️ TOMORROW’S WEATHER- We have a sunny day ahead of us in the capital tomorrow, with the mercury climbing to 33°C throughout the day, and cooling to 23°C at night, according to our favorite weather app.

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