The Finance Ministry will introduce a sweeping 33-step tax reform package that permanently abolishes arbitrary estimated tax assessments for future periods, Finance Minister Ahmed Kouchouk tells EnterpriseAM. However, old estimated tax disputes from previous years remain under the legacy rules.

Why this matters: The legislation — already approved by the cabinet and soon to be submitted to the parliament — marks a major shift toward rewarding compliant taxpayers and rebuilding trust with the private sector. It is a part of a broader state strategy to enhance domestic revenue generation and recalibrate spending priorities to maintain stable macroeconomic indicators amid mounting regional pressures.

The new package significantly boosts liquidity for compliant businesses, doubling the volume and value of immediate VAT refunds for “white list” taxpayers. It will also allow companies to directly recover cash credit balances from their income tax returns rather than just offsetting them against future liabilities. Furthermore, the tax dispute settlement law will be extended through 31 December.

Other key measures include easing procedures for writing off small debts, launching a digital tax advisory platform, introducing capital gains tax incentives for determining the acquisition cost of unlisted securities, and allowing the 2023-2024 tax periods to benefit from fixed and proportional tax systems.

No incentives without impact: The era of blanket state support is officially over. Kouchouk said that any future fiscal incentives or subsidies targeted at the productive, export, or tourism sectors will be strictly tied to tangible, measurable value added. Expanding this productive base will eventually ease the burden on investors and citizens, with the government currently eyeing strong potential for growth in outsourcing, ICT, and agricultural exports, Kouchouk added.

The government is relying on efficiency, not new taxes, to boost its revenues. Tax receipts jumped 31% y-o-y in the first eight months of the current fiscal year without the introduction of new burdens. During the same period, the government injected EGP 90 bn to stimulate economic activity and shield the budget from regional shocks, along with EGP 15 bn to fast-track the Hayah Karima initiative’s first phase.

Egypt’s overall fiscal position remains stable despite the challenging external environment, Kouchouk tells us, noting that swift and proactive policy responses played a key role in shielding the budget from deeper shocks.

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