Revenues from selling, creating online content 'subject' to taxes: Egypt's Finance Min.

CAIRO – 3 October 2021: Revenues from the sale of goods or services in Egypt, or the manufacture or promotion of content or advertisements via the internet or social networking sites, are subject to taxes in accordance with the established legal controls, Ramy Youssef, Advisor to the Minister of Finance for Tax Affairs, confirmed Sunday.

Youssef stated that an independent unit has been established in the Tax Authority for e-commerce, and decisive legal measures have been taken against violators.

"At the same time, we found a response by voluntarily registering with the Tax Authority, and paying the dues to the state's public treasury,” he added, explaining that a simplified guide will be issued showing the correct path to tax dealings for anyone who sells a good or service, publishes ads, manufactures or promotes content via electronic media or Social media and generate income.

This came during an open dialogue held by some leaders of the Ministry of Finance with a number of economic editors.

During the workshop, which was organized in cooperation with the Macroeconomic Reform and Stability Project of the United States Agency for International Development (USAID), the leaders said that they are working together as one harmonious team led by Mohamed Maait, Minister of Finance, to achieve economic goals through optimal use of global expertise and modern technology in laying the foundations for financial policies. It is balanced that meets the needs of citizens, contributes to strengthening the governance of the financial system, and maintains the country’s safe economic path.”

Ramy Youssef, added that the tax system is subject to a comprehensive and integrated development program, based on re-engineering procedures to standardize, simplify and automate them in order to enhance governance.

He said that it also aims to achieve tax justice in a way that contributes to facilitating financiers and expanding the tax base, by maximizing efforts to integrate the informal economy into the formal economy, taking into account the variables of transition to the digital economy.

He pointed out that digital transformation requires more effective mechanisms to raise the efficiency of tax collection, pointing out that projects to digitize the tax system do not mean laying off employees, but rather open new horizons for the employment of graduates who possess the elements of professional dealing with automated systems, along with efforts to develop skills. Tax Authority employees.

Mohamed El-Sobky, Advisor to the Minister of Finance and Head of the Programs and Performance Budgeting Unit at the Ministry of Finance, said that the preparation of the Programs and Performance Budget began in the 2016-2017 fiscal year for seven ministries, affecting the lives of citizens such as health, education, social solidarity, housing and transportation, and in the following years it was extended to other ministries in light of the government’s work program (2018-2022) within the framework of “Egypt Vision 2030, along with the budget items.

“We have started working on extending the umbrella of programs and performance to economic bodies, with the aim of raising the efficiency of public spending.”

He pointed out that the government's work program issued in 2019, which includes five strategic objectives, 25 main programs and 163 subprograms, was a strong start to implement the programs and performance budgets.

He added that the programs and performance budgets will be circulated to all parties following the issuance of the unified public finance law, which helps in raising the effectiveness of public spending; It gives us a degree of flexibility in implementing the general budget, especially in facing challenges and the right vision when setting the state's financial policies, measuring its various indicators and determining its results.

He praised the cooperation of the US Agency for International Development with the Ministry of Finance in training human cadres to implement programs and performance in a way that contributes to achieving economic and development goals.

Walid Abdullah, Head of the Central Department of Treasury Budget at the Ministry of Finance, Director of the Government Financial Information Management System (GFMIS) Project at the Ministry of Finance, confirmed that the Government Financial Information Management System (GFMIS), which was implemented with Egyptian help in less than a year, is a mirror that contributes to strengthening governance of expenditures and revenues, ensuring the rational management of the state’s public finances, and providing real-time data on budget performance, in a manner that helps raise the efficiency of public spending in various administrative agencies, control financial performance, tighten control over exchange, and ensure that financial appropriations are not exceeded by the legislative authority; In order to maintain debt and deficit rates, and strengthen the structure of the national economy.

He explained that the “electronic budget” made us able to determine the size of the state’s public treasury revenues, as well as the volume of expenditures in a momentary manner, and then estimate the correct position necessary to take any accurate decision related to the state’s public finances, especially in light of internal and external crises and challenges such as the “Corona” crisis, where We were able to flexibly deal with the repercussions and negative effects of the pandemic in a way that won the praise of international financial and rating institutions.

He added that the application of the "GFMIS" system in the budgetary entities with its accounting units, which amounted to about 2,637 units of account, and linking it to the electronic payment and collection system "GPS", and the unified treasury account "TSA", also contributed to closing the final accounts of the budget that ended on the same day at the end of the year, and that the budget works From the first day of the new fiscal year, in a manner that leads to achieving transparency and quality of performance, whereby the budget-financed entities are able to meet the requirements of their approved activities and plans in accordance with the specific financial allocations; Which helps in raising the level of services and facilitating the means of providing them to citizens in various sectors.

Sarah Eid, Head of the Transparency and Community Participation Unit at the Ministry of Finance, stressed the importance of the citizen being a partner in sustainable development by participating in the preparation stage for the development of the plan, and the general budget of each entity by presenting the needs of each region, stating its vision for the plans to be implemented, and considering it by the plan drafters.

She pointed to the role of the unit in involving the citizen in the budget preparation process at the local level, as well as effectively involving youth in the most important contents of the new budget, as the unit issues various financial reports on the budget preparation cycle.

She added that the Ministry of Finance launched the eighth consecutive issue of the citizen's budget for the fiscal year 2021-2022 under the title: "Supporting economic activity, consolidating the principle of citizenship, supporting human development and social protection," from Fayoum Governorate; Believing that the citizen is an authentic partner in the development of the localities through the participatory budget, a meeting was prepared for a group of young people with Ahmed Al-Ansari, the governor of Fayoum, to participate in the citizen’s budget; As one of the most important tools of “participatory budgeting”.