Egyptian Cabinet allows regulatory action to cancel tax exemptions for state entities
(MENAFN) On Wednesday, the Egyptian Council of Ministers granted approval for a regulatory decision aimed at revoking numerous tax and fee exemptions previously granted to state agencies. This move is in compliance with a significant condition outlined by the International Monetary Fund (IMF) in the USD3 billion agreement inked a year ago. The government had initially endorsed the draft law in June, but the finalization of executive regulations required for implementation was pending.
The IMF, in the financial support agreement signed with Egypt in December 2022, emphasized the imperative of achieving equity and reinforcing fair competition norms between the public and private sectors. However, the implementation of this agreement remained in a dormant state, primarily due to Egypt falling short on other commitments, including permitting the market to determine the pound's value, expeditiously selling certain state assets, and diminishing the government's role in the economy.
The government's statement clarified that the decision to cancel tax and fee exemptions applies universally to all investment or economic activities undertaken by state agencies. These encompass units within the state's administrative apparatus, local administration units, national public, service, and economic bodies, agencies with special budgets, as well as entities and companies owned directly or indirectly by any of the aforementioned entities, irrespective of their legal form. The regulatory measure represents a pivotal step in aligning with IMF stipulations and fostering a more equitable economic landscape in Egypt.
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