Egypt’s tax revenues in financial year 2011/2010 exceeded forecasts by LE23 billion ($3.8 billion), according to Mohamed Sorour, advisor to the minister of finance.
In a Wednesday meeting with the American Chamber of Commerce in Cairo, Sorour said that the unexpected growth in tax collection is due to “taxpayers' sense of national duty” along with new dispute resolution policies undertaken by Egypt's tax authority.
“The increase in tax revenues materialised under the existing law without any amendments,” Sorour explained. “An increase in the tax rate could have a reverse effect.”
Addressing the issue of raising the tax rate, Sorour said that Egypt is dependent on foreign investment and that tax rates should remain low in able to attract investors.
The General Federation of Investors Unions (GFIU) suggested raising the income tax ceiling from 25 to 30 per cent in a meeting with Egypt’s finance minister on Monday.
Sorour said that this suggestion has not been discussed with enough players in the business community to determine its viability.
Total tax revenues grew by 15.6 per cent during the 2010-2011 financial year to reach LE169.7 billion, versus LE146.6 billion in the previous year.
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