Egypt pushes tax changes on natgas + revives stamp tax to shrink financing gap

Egypt is broadening its tax base to hit fiscal reform targets. The latest move: Cabinet wants to strip the natural gas industry of its long-standing exemption from the value-added tax, having signed off on the text of a bill (pdf) that would, if passed, see natural gas subject to a flat table tax of EGP 20 per thousand cubic feet. The bill would leave in place the industry’s exemption from VAT on production machinery to four years to stimulate local manufacturing. An exemption for medical equipment would also be preserved.

The fiscal play: The state is dismantling long-standing exemptions to hit a record EGP 3.5 tn(USD 68 bn) tax revenue target for FY 2026-27 and shrink its EGP 2.7 tn (USD 52 bn) financing gap. The steady phase-out of special tax treatments on goods like sugar, tea, professional services — and now gas — aligns with IMF recommendations to unify the standard 14% rate and eliminate market distortions.

What to watch for next: The bill will now move to the House of Representatives for approval.

A clearer tax framework for the EGX: The Madbouly government separately sent the House draft amendments to the stamp tax law that would replace a capital gains tax on EGX transactions with a tiered stamp tax — 0.05% on market makers and blue-chip stocks and 0.1% on all other shares — according to a document seen by EnterpriseAM. Sources previously told us that we can expect the government to introduce a stamp tax on EGX transactions next month.

Want the full story? Our Egypt desk dove into the tax last month in our coverage of a wider tax package that also included changes to the VAT.