How to calculate salary tax after new exemption?

CAIRO- 3 July 2017: Egypt’s government approved new amendments to the Income Tax Law, under which the annual salaries of public employees will be divided into five tranches.

After the amendments, the calculation of public employees’ salaries changed. The annual pay is divided into different categories, with each category benefiting from tax exemptions at different percentages:

• LE 7,000 category is exempted
• LE 7,200 category is exempted
• LE 15,000 category is subject to 15 percent tax
• LE 22,800 category is subject to 10 percent tax
• LE 30,000 category is subject to 20 percent tax

Applying the aforementioned exemptions and tax reductions, the first tranche of employees, with salaries up to LE 14,200 per annum will be fully exempted.

Meanwhile, the second tranche, whose salaries reach LE 37,000, will be subject to a 10 percent tax at LE 2,280. However, they will additionally benefit from a recently-imposed 80 percent tax exemption, to pay a total of LE 456 per year at final.

Employees with salaries of LE 52,000 are falling under the third tranche, which is subject to 15 percent tax. After applying the exemptions of each category of their salary, the final tax to be paid by this tranche will be LE 3,630.

The tranche obtaining LE 82,000 per year will pay a final tax of LE 10,230.
Salaries between LE 155,000 and LE 207,000 will pay a tax of between LE 29,450 and LE 33,980.

Also, salaries above LE 307,000 will pay a total tax of LE 58,030 per annum.