{"id":662575,"date":"2025-03-19T00:00:00","date_gmt":"2025-03-19T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2025\/03\/19\/finmin-to-issue-amendments-to-the-vat-law\/"},"modified":"2025-03-19T00:00:00","modified_gmt":"2025-03-19T00:00:00","slug":"finmin-to-issue-amendments-to-the-vat-law","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2025\/03\/19\/finmin-to-issue-amendments-to-the-vat-law\/","title":{"rendered":"FinMin to issue amendments to the VAT Law"},"content":{"rendered":"

The gov\u2019t is working on amending the VAT Law:<\/strong> The Finance Ministry is moving to reduce tax exemptions under the Value Added Tax (VAT) Law, with the government looking to review goods currently exempt from the law and limit goods subject to special tax treatments, either higher than the standard VAT rate \u2014 such as telecommunications and cars \u2014 or lower at 5%, three government sources told EnterpriseAM.<\/p>\n

The measure comes as part of our reform program with the International Monetary Fund<\/strong>, one source said, adding that applying different tax rates instead of the standard 14% prevents businesses from deducting VAT on input costs. This, in turn, leads to manufacturers paying a higher tax and the consumer bearing the full tax amount.<\/p>\n

Unifying the 14% VAT rate across most goods has long been a demand of the business <\/strong>co<\/strong>mmunity,<\/strong> one source said, adding that Saudi Arabia, for example, has implemented VAT on all goods and services at a flat rate of 15% without exceptions.<\/p>\n

What\u2019s been done so far:<\/strong> The government has reviewed 20 of the 56 tax-exempt goods, with the aim of gradually removing all exemptions, the sources said. Sugar, tea, and coffee are among the goods that are expected to be removed from the list of exemptions, while taxes on oils and detergents will also be adjusted to reflect inflationary pressures. The changes will require legislative amendments, which are expected to be presented to the House of Representatives soon, with implementation likely before the start of FY 2025-26. <\/p>\n

It\u2019s all about simplifying procedures:<\/strong> While the amendments will generate additional tax revenue, the sources emphasized that the primary goal is to correct tax distortions and simplify procedures.<\/p>\n

The amendments will not affect the VAT registration threshold<\/strong> \u2014 currently set at EGP 500k \u2014 despite requests from the business community to increase the threshold. The Finance Ministry won\u2019t alter any core provisions of the law, including the tax rate. <\/p>\n

DATA POINT- <\/strong>The government is hoping to reach EGP 1.8 tn in tax revenues by the end of the fiscal year in June, with VAT making up EGP 719 bn of that sum. Tax revenues grew by 30% y-o-y in fiscal year 2023-24 to record EGP 1.49 tn<\/a>. <\/p>\n","protected":false},"excerpt":{"rendered":"

The measure comes as part of our reform program with the IMF<\/p>\n","protected":false},"author":1,"featured_media":662576,"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":[72,276,69,7110],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-662575","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-tax","tag-enterpriseam","tag-finance-ministry","tag-tax","tag-vat","wpautop","entry"],"acf":{"mongo_id":"621ec50a-bb69-45a1-88e1-c489c53c8b8f","order":"4","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2025\/1\/1760.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Egypt\u2019s FinMin to issue amendments to the VAT Law","related_issue":[662570],"teaser":"The measure comes as part of our reform program with the IMF","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2025\/3\/.31db4ebd-cabe-4edc-b75f-d89b9dae7c4b.mp3"},"yoast_head":"\nFinMin to issue amendments to the VAT Law - 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The ministry says the executive regulations clarified definitions, including, for example, contentious items like what \u201cprofessional services\u201d entail, and resolved ambiguity on exemptions and processes. It also explains the transition to VAT\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":667596,"url":"https:\/\/enterpriseam.com\/egypt\/2025\/06\/30\/house-approves-amendments-to-vat-law-on-select-items\/","url_meta":{"origin":662575,"position":1},"title":"House approves amendments to VAT Law on select items","author":"enterpriseam admin","date":"30 June 2025","format":false,"excerpt":"The amendments are set to affect the prices of construction and contracting services, crude oil, cigarettes, and alcoholic beverages","rel":"","context":"In "Tax"","block_context":{"text":"Tax","link":"https:\/\/enterpriseam.com\/egypt\/category\/tax\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2024\/11\/466.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":674220,"url":"https:\/\/enterpriseam.com\/egypt\/2025\/10\/26\/finance-ministry-rolls-out-tax-workaround-for-contractor-contracts-inked-before-vat-shake-up\/","url_meta":{"origin":662575,"position":2},"title":"Finance Ministry rolls out tax workaround for contractor contracts inked before VAT shake-up","author":"enterpriseam admin","date":"26 October 2025","format":false,"excerpt":"The move follows VAT amendments ratified in July that subjected all new construction and contracting contracts to the standard 14% VAT rate","rel":"","context":"In "Tax"","block_context":{"text":"Tax","link":"https:\/\/enterpriseam.com\/egypt\/category\/tax\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2025\/10\/1310.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":596348,"url":"https:\/\/enterpriseam.com\/egypt\/2019\/08\/26\/govt-could-impose-5-10-schedule-tax-on-social-media-ads\/","url_meta":{"origin":662575,"position":3},"title":"Gov\u2019t could impose 5-10% schedule tax on social media ads","author":"enterpriseam admin","date":"26 August 2019","format":false,"excerpt":"EXCLUSIVE- The government is looking to impose a 5-10% schedule tax on social media and internet search ads on top of the 14% VAT as part of anticipated amendments to the VAT Act, government sources told Enterprise. Schedule tax is a type of sales tax imposed on some luxury goods\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/internal\/536550.png?resize=350%2C200&ssl=1","width":350,"height":200},"classes":[]},{"id":572225,"url":"https:\/\/enterpriseam.com\/egypt\/2020\/06\/16\/ads-will-be-subject-to-vat-but-not-stamp-tax-vat-drawback-system-for-tourists-could-be-expanded-under-sweeping-changes-proposed-to-value-added-tax-act\/","url_meta":{"origin":662575,"position":4},"title":"Ads will be subject to VAT (but not stamp tax), VAT drawback system for tourists could be expanded under sweeping changes proposed to Value-Added Tax Act","author":"enterpriseam admin","date":"16 June 2020","format":false,"excerpt":"SMART POLICY- Most commercial advertising will be subject to value-added tax under sweeping amendments to the VAT Act that the Finance Ministry finalized yesterday andposted to its website (pdf). In a move sure to be welcomed by advertisers and media organizations alike, the amendments would (if passed) also lift the\u2026","rel":"","context":"In "Speed Round"","block_context":{"text":"Speed Round","link":"https:\/\/enterpriseam.com\/egypt\/category\/speed-round\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2020\/6\/173.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":648799,"url":"https:\/\/enterpriseam.com\/egypt\/2017\/04\/12\/finance-ministry-reduces-vat-on-imported-capital-goods-to-5\/","url_meta":{"origin":662575,"position":5},"title":"Finance Ministry reduces VAT on imported capital goods to 5%","author":"enterpriseam admin","date":"12 April 2017","format":false,"excerpt":"The Finance Ministry has cut the value-added tax on imports of machinery, equipment, and capital goods to 5%, effective immediately, according to a statement from the ministry. 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