The National Telecommunications Regulatory Authority (NTRA) is imposing new customs duties on imported mobile phones starting on 1 January. For travellers bringing new phones into the country, the fee, calculated as a percentage of the new device’s price, will be collected at customs.

If the new devices are not reported to a customs officer, the Ministries of Finance and Communication have launched a new app called Telephoni (My Phone) that allows Egyptians to register their imported devices.

As soon as Telephoni was launched, thousands of people went online to enter their phone numbers to check if they owed duty. Some 2.1 million people have downloaded the application since its launch, and around 700,000 inquiries have been made through the platform.

NTRA Director Mohamed Shamroukh said in a press conference last Thursday that text messages will be sent to people who brought in mobiles after 1 January, the date the new measure went into effect.

He stressed that it will not apply to phones brought in and activated before this date. “However, if a mobile phone entered Egypt before this measure went into effect, but the SIM card was not activated before 1 January 2025, the new measure will apply to it,” Shamroukh said.

 Around 725,000 Samsung phones and 492,000 iPhones were registered within the space of 24 hours ahead of the new year to avoid having to pay the new customs tax.

Shamroukh said the new measure is not intended to overburden people, but rather to prevent traders from tax evasion. Egyptian expatriates will be able to bring in their used phones without having to pay duties, he stressed.

One of the reasons for introducing the new measure is to minimise the challenges Egypt faces in localising the mobile phone industry, he said. Smuggling poses a significant threat to the national economy, and around 90 per cent of the phones that entered the country over the past two years were brought in illegally, harming both government revenues and local manufacturers.

The NTRA has received complaints from local manufacturers pointing to their inability to sustain operations under current investment conditions. The NTRA has successfully thwarted 13 attempts to smuggle in devices, with these being referred to the Public Prosecutor’s office.

The new measure is consistent with similar systems applied elsewhere in the world, Shamroukh said. Most countries impose duties on imported electronic devices, even on foreigners if their stay exceeds a specified period.

Any foreigner whose visit exceeds three months in Egypt should be considered a resident and therefore should be subject to the tax on imported devices, he said.

Meanwhile, Egypt has been making significant strides in local mobile phone production. According to Shamroukh, 80 per cent of the domestic market’s needs can now be covered by newly established local firms as part of the progress being made to localise the electronics industries and promote digital transformation.

The government is weighing bids by two firms to locally manufacture 5G-supported phones at competitive prices ranging from $100 to $300.

Mohamed Talaat, head of the Mobile Phone Division at the Federation of Chambers of Commerce, said that “we have five telephone assembly factories in Egypt, and there is no difference between the phones assembled here and the imported versions.”

 “The factories make Samsung, Vivo, Xiaomi, Oppo, and Infinix phones, and one of them opened just two months ago.”

Talaat said that customs duties on imported mobile phones have existed for years, but the majority of phones have been smuggled in, which “runs counter to the interests of investors in Egypt and harms the national economy.”

Egyptians have long preferred to buy mobile phones abroad because they were often as much as 30 per cent cheaper than if purchased locally.

Nermine, who bought a new device three months ago because she needed it for work, was able to find the model she wanted in Saudi Arabia for the equivalent of LE18,000, whereas in Egypt it would have cost her LE25,000.

She had one of her relatives working in Saudi Arabia bring it back for her when he came home on holiday.

Explaining why such large price differences continue to exist, Talaat said it was because the mobile phone assembly factories have only recently started operations in Egypt.

“We hope they will lower their prices to fairer and more reasonable levels in the near future,” he said.

* A version of this article appears in print in the 9 January, 2025 edition of Al-Ahram Weekly