Egyptian tax authority releases new tax regs. for small businesses

Cairo – January 23, 2024: As part of efforts to improve the country’s business climate and streamline tax procedures, Egypt is launching simplified tax regulations for establishments with an annual turnover not exceeding LE 10 million, announced Rasha Abdel-Aal, acting head of the Egyptian Tax Authority (ETA), on Tuesday.

The new regulations are within the Minister of Finance Mohamed Maait’s instructions to resolve tax disputes for establishments with turnovers below LE 10 million, emphasized Abdel-Aal.

She added that the government is committed to providing streamlined processes for taxpayers and expediting transactions through mechanization.

The new tax system stated that establishments with a business turnover below LE 250,000 will be subject to an annual tax of LE 1,000.

Businesses with turnovers ranging from LE 250,000 to LE 500,000 will face a tax of LE 2,500, while those with turnovers between LE 500,000 and LE 1 million will incur a tax of LE 5,000

Establishments with turnovers from LE 1 million to less than LE 2 million will be taxed at a rate of 0.5 percent. For turnovers between LE 2 million and less than LE 3 million, the tax rate will be 0.75 percent, and turnovers ranging between LE 3 million and LE 10 million will be taxed at a rate of 1 percent.

In May 2023, the Egyptian parliament passed a bill introducing amendments to the tax system, including a simplified tax framework for small and micro-scale enterprises with annual transactions not exceeding LE 10 million.

These initiatives are part of Egypt’s broader strategy to enhance the business climate, streamline tax procedures for startups, and increase the private sector's role while attracting investments.

The government aims to raise the private sector's contribution to the economy from 60 percent to 90 percent between 2024 and 2030, along with attracting around $100 billion in direct foreign investments over the same period.