{"id":667596,"date":"2025-06-30T00:00:00","date_gmt":"2025-06-30T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2025\/06\/30\/house-approves-amendments-to-vat-law-on-select-items\/"},"modified":"2025-06-30T00:00:00","modified_gmt":"2025-06-30T00:00:00","slug":"house-approves-amendments-to-vat-law-on-select-items","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2025\/06\/30\/house-approves-amendments-to-vat-law-on-select-items\/","title":{"rendered":"House approves amendments to VAT Law on select items"},"content":{"rendered":"

VAT amendments approved:<\/strong> The House of Representatives gave its final approval to the government-drafted bill amending the VAT Law yesterday \u2014 the amendments will impact the prices of construction and contracting services, crude oil, cigarettes, and alcoholic beverages, according to a statement seen by EnterpriseAM. Here are the key changes to VAT Law under the approved amendments:<\/strong><\/p>\n

#1- Taxing crude:<\/strong> The amendments also introduce a new tax treatment for crude oil \u2014 making it subject to a 10% tax, which the Egyptian Tax Authority confirmed<\/a> will not result in any additional increases in local fuel prices.<\/p>\n

#2- Construction and contracting services will also be subject to the standard 14% VAT rate <\/strong>\u2014 under the current VAT system supply and installation services are taxed at a flat 5% schedule rate without allowing companies to deduct input VAT.<\/p>\n

THERE\u2019S MORE TO THE STO<\/strong>RY- <\/strong>We dove into what new VAT rules could mean for contractors in a Hardhat published earlier this year. Check it out here<\/a>.<\/p>\n

#3- Tax hikes on local and imported cigarettes:<\/strong> Locally produced cigarettes priced at or below EGP 38.88 will increase to up to EGP 48 for consumers, while those priced between EGP 38.88-56.44 will go for EGP 48-69. <\/p>\n

As for imported cigarettes<\/strong>, those priced at or below EGP 56.44 will go for up to EGP 69. The amendments also stipulate a 12% annual increase for the aforementioned cigarette categories over the coming three years starting 2 November.<\/p>\n

#4- Alcoholic beverages will be taxed based on their alcohol percentage<\/strong>, with the tax percentage set to rise by 15% annually for the next three years \u2014 after which the annual increase will be reduced to 12%. The amendments are in line with the World Health Organization\u2019s standards, and come with the aim of protecting public health, our sources said. Red wine and both distilled and non-distilled spirits will be subjected to the following flat tax rates per 100 liters based on their alcohol level:<\/p>\n