Tax settlement scheme expected to bring in EGP 800 bn by the end of the fiscal year

The first phase of the tax settlement initiative has so far brought in 30k requests to settle disputes and reconcile with the Egyptian Tax Authority, generating EGP 300 bn in additional revenues so far, a government source told EnterpriseAM. The source expects this figure to rise to EGP 800 bn by the end of the current fiscal year on 30 June.

Simplifying the tax system and incorporating the informal economy is an important pillar of the state’s tax plan, as it aims to increase tax revenues to EGP 2.6 tn during the next fiscal year, the source told us.

REMEMBER- The Finance Ministry last month extended the deadline for pre-2020 tax dispute requests by three months to 12 August. The decision was part of measures the Finance Ministry is rolling out to make it more attractive for businesses to settle disputes dating to before 2020, including by paying a fixed percentage of taxes owed. Businesses will be able to make those payments in four installments over a 12-month period without paying late fees or additional interest charges. This comes as part of a larger push by the Finance Ministry to widen the tax base.

The government has already begun drafting a second package of tax incentives based on community dialogue held with taxpayers and investors over the past few months, our source told us. The necessary legislation is now being drawn up, and the finalized package is expected to be launched before the end of the year, according to the source.