{"id":660730,"date":"2025-02-17T00:00:00","date_gmt":"2025-02-17T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2025\/02\/17\/freshly-approved-tax-facilities-set-to-come-into-effect-in-march\/"},"modified":"2025-02-17T00:00:00","modified_gmt":"2025-02-17T00:00:00","slug":"freshly-approved-tax-facilities-set-to-come-into-effect-in-march","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2025\/02\/17\/freshly-approved-tax-facilities-set-to-come-into-effect-in-march\/","title":{"rendered":"Freshly approved tax facilities set to come into effect in March"},"content":{"rendered":"<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"> <strong>Fresh <\/strong><strong>tax facilities will come into effect next month: <\/strong>A number of tax facilities that have to do with SMEs, simplifying tax procedures, and settling disputes will take effect in March, the Finance Ministry <a target=\"_blank\" href=\"https:\/\/www.facebook.com\/MOF.Egypt\/posts\/pfbid02BxnerriesLgmY8gdB6jQwekCC3anHFPtpjBMeyVQbSK2R8bfntqkA3PEtKxuZfuCl\" style=\"\" rel=\"noopener\">said<\/a> yesterday.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>They were signed into law last week: <\/strong>President Abdel Fattah El Sisi last Thursday ratified three new laws that will expand the scope of tax exemptions for small and medium enterprises, simplify tax procedures, and help settle disputes, according to decisions published in the Official Gazette. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\">(<strong>Tap or click the headline above to read this story with all of the links<\/strong> to our background as well as external sources.)<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>It didn\u2019t take long to get here: <\/strong>We <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/d077e660-9c01-4f7e-b86c-577319ff8717\" style=\"\" rel=\"noopener\">first heard<\/a> about the three new laws in October when Kouchouk announced a long list of tax facilities as the first phase of a package of tax facilities aimed at simplifying the tax system and easing the burden on taxpayers. The House then <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/bb4037bd-21ad-4bc2-b694-4be738029db5\/mps-greenlight-draft-laws-to-simplify-sme%253cmark%253e-tax%253c%2Fmark%253e-regime,-give-late-payment-amnesty,-speed-up-dispute-settlement\" style=\"\" rel=\"noopener\">passed the three tax-focused draft laws<\/a> in late January.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>HERE ARE SOME OF THE MOST IMPORTANT FACILITIES IN THE NEW LAWS- <\/strong><\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>#1- Outstanding tax disputes related to real estate and unlisted securities could soon be<\/strong><strong> resolved<\/strong> with full penalty waivers if they pay their dues within a set timeframe. The tax burden may be completely waived if five years have passed since the transaction.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>#2- A cap on late payment fees:<\/strong> One of the laws puts a cap on late payment penalties so that the penalty does not exceed the original amount of tax due. The government will also scrap any late fees due to audit delays or drawn-out disputes. The law amendments also introduce a 12.5% compensation rate for uncollected or withheld amounts.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>#3- Efforts to integrate the informal economy: <\/strong>One law aims to integrate the informal economy into the formal economy by granting them a fresh start, with tax obligations only counting from the registration date. Under the law, businesses will have three months to get registered.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>#4- A grace period: <\/strong>Taxpayers who failed to submit their tax reports between the 2020 and 2024 tax seasons will be allowed to file them within a specific time frame without facing any penalties. The law also entails leniency for erroneous returns filed during that same period, which can be corrected and refiled without penalty.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>#5- Big relief for SMEs: <\/strong>Among the laws ratified by El Sisi is one that reduces income tax rates to 0.4-1.5% of annual revenues for businesses with an annual turnover not exceeding EGP 20 mn. SMEs will also be exempted from development fees, stamp tax, and company registration fees, among others. <\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>We\u2019re just scratching the surface: <\/strong>For the full breakdown of what the new SME tax system entails, check out our coverage of the news back in January <a target=\"_blank\" href=\"https:\/\/enterprise.news\/egypt\/en\/news\/story\/7983a6ed-cf0d-4bd6-8dfe-9f43265d0121\/gov%25e2%2580%2599t-to-forego-egp-800-bn-in-tax-revenues-in-favor-of-broader-tax-base\" style=\"\" rel=\"noopener\">here<\/a>.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>A move in the right direction, but still more to do: <\/strong>Finance Minister Ahmed Kouchouk <a target=\"_blank\" href=\"https:\/\/www.linkedin.com\/posts\/ahmed-kouchouk-51aaa0b_%D8%A7%D9%84%D8%AC%D8%B1%D9%8A%D8%AF%D8%A9-%D8%A7%D9%84%D8%B1%D8%B3%D9%85%D9%8A%D8%A9-%D9%82%D9%88%D8%A7%D9%86%D9%8A%D9%86-5-%D9%886-%D9%887-%D9%84%D8%B3%D9%86%D8%A9-2025-activity-7295903037838000128-m_ix\/?utm_source=share&utm_medium=member_desktop&rcm=ACoAAA9BnlUBL29leiSYq5O7FDShYLleY8j7-yI\" style=\"\" rel=\"noopener\">said<\/a> that the move represents \u201ca fresh start for all taxpayers, in line with our dedication to strengthening the principles of partnership, trust, and certainty with the business community.\u201d Three government officials told EnterpriseAM that the Finance Ministry is finalizing the amendments to the executive regulations and additional tax authority directives to ensure the smooth implementation of the new rules. The officials also noted that while the government aims to avoid major legislative amendments, some issues will be addressed through executive orders from the finance minister and ETA head.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>More reforms are on the way: <\/strong>A centralized e-clearance system is set to launch by 2Q 2025, with pilot operations already underway at 50 major companies, sources explained to EnterpriseAM.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>ALSO IN THE PIPELINE: <\/strong>The Finance Ministry will double the tax registration threshold for foreign firms linked to local entities to EGP 30 mn, aiming to ease compliance burdens on multinationals and their local branches. Under this proposed amendment to the Income Tax Law, foreign companies will be required to submit global branch reports, outlining financial activities in each country where they operate.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Some of the changes are already in motion: <\/strong>Last week, the Finance Ministry issued a directive allowing some big taxpayers to transition to sample-based audits instead of comprehensive audits. This move is expected to ease the burden on businesses by reducing the number of companies subject to full audits. Only 20% of taxpayers will be selected for annual reviews, based on risk assessment indicators such as tax evasion history, reported losses, and discrepancies in tax filings, informed sources told EnterpriseAM.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Sector-specific taxation guidelines are returning: <\/strong>The ETA plans to reinstate sector-based tax guidelines to standardize tax assessments across industries and eliminate inconsistent tax estimates across different regions. The new framework will apply to 710 commercial and industrial activities, covering transportation, tourism, petroleum, construction, and animal and fish production. The guidelines will be introduced gradually.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Even with the exceptions, the gov\u2019t is hoping that it can increase tax revenues: <\/strong>The Finance Ministry is hoping to raise tax revenues to 15-16% of GDP within the next five years, up from 11.8% currently, Deputy Finance Minister for Tax Policies Sherif El Kilani said at a PwC Middle East conference on Thursday attended by EnterpriseAM. <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Finance Minister Ahmed Kouchouk said that the move represents \u201ca fresh start for all taxpayers\u201d<\/p>\n","protected":false},"author":1,"featured_media":660731,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[7382],"tags":[782,679,72,69],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-660730","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tax","tag-ahmed-kouchouk","tag-egyptian-tax-authority","tag-enterpriseam","tag-tax","wpautop","entry"],"acf":{"mongo_id":"a26c63b7-38a8-4faa-8d38-9ca745b8d079","order":"5","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2025\/2\/1472.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Freshly approved tax facilities set to come into effect in March","related_issue":[660722],"teaser":"Finance Minister Ahmed Kouchouk said that the move represents \u201ca fresh start for all taxpayers\u201d","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2025\/2\/.6c482a42-d52e-4783-a507-43a131f6b5a1.mp3"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.1 (Yoast SEO v27.1.1) - 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