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Friday, 29 May 2020

Egypt introduces new incentives to boost economy amid coronavirus crisis

Menna Alaa El-Din , Tuesday 17 Mar 2020
Prime Minister of Egypt Mostafa Madbouly (Al-Ahram)
Prime Minister of Egypt Mostafa Madbouly (Al-Ahram)
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Egypt’s cabinet has said it will lower natural gas prices for industry and provide EGP 1 billion for exporters as part of a package of measures aimed at supporting the industrial sector and the economy in the wake of the coronavirus outbreak.

The decisions include reducing natural gas prices to $4.5 per million British Thermal Units (mmBtu) for industry, and lowering electricity prices by ten piasters for heavy and average-use industries.

The government said it would keep power prices for other sectors unchanged for the upcoming three to five years. 

Other measures include providing EGP 1 billion for exporters in March and April to pay part of their dues under approved initiatives, and an additional ten percent payment to exporters in June. 

An outstanding property tax on factories and touristic institutions will also be postponed for three months, and it will be paid following that period in monthly instalments for six months. 

Regarding the stock exchange, the government decided to lower stamp duty for foreign investors from EGP 1.5 to EGP 1.25 per EGP 1,000. 

Local investors will see stamp duty reduced from EGP 1.5 to EGP 0.50 per EGP 1,000, the cabinet said, until the implementation of a capital gains tax starting 2022. 

It has also exempted immediate stock transactions from stamp duty to boost trading, and exempted foreign investors from the capital gains tax and delayed its implementation for local investors to January 2022. 

A tax on dividend distribution by listed companies was halved to 5 percent. 

President Abdel-Fattah El-Sisi announced on Sunday a EGP 100 billion plan to tackle the coronavirus.

The outbreak has taken a major toll on markets worldwide. 

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