Amendments on income tax law soon: Finance Ministry source

Salma Hussein, Monday 23 May 2011

Amendments would raise taxes on companies' profits, not the wages of employees

Income tax
New tax exemptions expected for lowest wages. (Photo: AP)

Changes to Egypt's taxation system will see higher taxes imposed on individuals and companies earning higher incomes.

"We are trying to avoid higher taxes on employees as the new wage structure will not permit soaring bonuses for senior civil servants," says a source in the Finance Ministry acquainted with the issue. "The new wage structure won't allow any one to take one million pounds."

"What is on the table currently is a rise of taxes on companies' net profits. We don't want to raise burdens on people's back. A new tax on wealth is not, however, on the menu."

The exemption borderline is also to be raised, it is currently at LE7,000 a year. The minister of social justice, Gouda Abdel khaleq, suggested today in a press conference that this borderline should be raised to LE18,000 a year.

Abdel Khaleq also said that a new tax would be introduced on Bourse profits and amendments will be made to the property tax law.

The "whole package of tax laws" is being currently revisited. "But the government will only consider the income tax law for the time being, [so as] not to shake the business climate," added the source.

"The governement didn't reach consensus yet in this regard. The matter is still under study."

These amendments will be announced in a military decree, revealed the source, which implies that they are to be announced in the next couple of months ahead of September's parliamentary elections.

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