Electronic systems at Finance Ministry to be integrated by end of June 2021

CAIRO – 4 August 2020: "Ministry of Finance has made great strides in the implementation of the national project for digital transformation, as all electronic systems in the Ministry of Finance will be integrated by the end of June 2021," Finance Minister Mohamed Ma’it said Tuesday.

The minister added in a statement that this project contributes to strengthening governance, laying the foundations for financial discipline, raising the efficiency of public spending, and modernizing and automating the systems of customs and tax administration.

He stated that the project thus helps in achieving financial and economic goals, enabling the state to complete its development process, and improve the citizens' standard of living and better the services provided to them.

Ma’it explained that the system of electronic tax invoice is scheduled to be implemented compulsorily in November 2020 through a central electronic system, in which the Tax Authority monitors all commercial transactions between companies through electronic exchange of billing data without relying on paper transactions.

He pointed out that this system helps to define the tax community more accurately, integrating the informal economy into the formal economy, and achieving tax justice in a way that contributes to achieving the right of the state.

The trial operation of the electronic tax invoice system began on June 30, with the participation of a number of companies, then the head of the Tax Authority issued a decision to compel a number of companies (as a first stage) to issue electronic tax invoices for the goods they sell or services they provide as of November 15.

Ma’it said that this advanced system helps funders verify the authenticity of billing data for dealers prior to issuance, enhance their tax positions by classifying them as companies with low tax risks, facilitate procedures for reconciliations between companies regarding value-added tax, and modernize exchanging bills between companies.

He added that this system also contributes to reducing the administrative burden; reducing the cost of transactions; simplifying procedures for examining companies with the possibility of remote examination; facilitating procedures for tax refund, the process of preparing and submitting declarations, and ending traditional procedures with companies to collect bills.

The minister further clarified that the ministry is vigorously advancing the modernization and mechanization of the tax administration system. This contributes to facilitating and unifying procedures, stimulating the investment environment, maximizing productive capabilities, and creating more job opportunities; it also helps to improve Egypt's ranking in global indicators of doing business.

He pointed out that Egypt's electronic representations jumped 3 places in the World Bank Index, as it contributed to a more accurate inventory of the tax community, achieving tax justice, and integrating the informal economy into the formal economy.

The minister also confirmed that the ministry is pursuing the modernization and mechanization of the customs administration system, and it is scheduled to manage approximately 90 percent of exports and imports electronically by the end of December 2020 through the system of logistic centers.

“This update contributes to simplifying procedures, reducing release time to less than 5 days, and reducing costs of customs clearance, in a manner that helps to stimulate the investment environment and improve Egypt's ranking in international indicators of business performance,” he explained.

Furthermore, the minister said that the logistic centers were operated in Cairo, West and East Port Said and Ain Sukhna, and it is intended to operate logistic centers in Dekheila during the coming November, and in Alexandria and Damietta at the end of 2020. About 90 percent of exports and imports will be managed electronically by the end of 2020.

He added that the new draft customs law, which is being discussed in the House of Representatives, also aims to simplify procedures, reduce the cost of goods, reduce the time of customs release through the optimal employment of modern technology and localize distinguished international experiences in the application of the single window system, gradually transitioning from paper-based work to digital work.

The minister stated that, according to the draft law, for the first time, an electronic system will be established to track the goods until the final release stage, and to deal with the contracted goods using the modern electronic commerce system, with the possibility of pre-querying customs duties before the arrival of the goods.

This system also allows the exchange of information and data secured electronically between the Customs Authority and the agencies of the state or external parties, with which agreements have been concluded. It also aims at the introduction of a risk management system that leads to the release of goods without detection or inspection across the green path, in accordance with the established controls. This is in order to simplify the procedures and speed up customs release, according to Ma'it.

Additionally, the minister revealed that the state’s general budget is currently managing revenues and expenditures electronically in a manner that contributes to controlling financial performance, raising the efficiency of public spending, and tightening control over exchange, providing accurate real-time data on the performance of all budgets of bodies and units of each minister or governor or rector.