Egypt’s Minister of Trade and Industry Nevine Gamea has announced that the Small, Medium and Micro Enterprises Development Law will provide an integrated package of facilities and privileges for entrepreneurs.
The minister, who is also Executive Director of the Micro, Small, and Medium Enterprises Development Agency (MSMEDA), said that the law provides a simplified tax system for the medium, small and micro enterprises (MSMEs) sector.
As part of this, the volume of sales or business is determined through a simplified tax return that is prepared by the business owner himself once a year. It does not require books, documents or purchase invoices.
Gamea added that, according to the new law, if sales or business volume is less than EGP 250,000, the small business will be taxed EGP 1,000 annually. If it is less than EGP 500,000, taxes of EGP 2,500 will be paid, and if it is less than EGP 1m, taxes of EGP 5,000 will be paid annually.
If it is between EGP 1m-EGP 2m, taxes of 0.5% of the volume of sales or business will be paid, with taxes of 0.75% of the total sales or business volume to be paid if it ranges from EGP 2m-EGP 3m. If the sales or business volume ranges from EGP 3m- EGP 10m, the business will be taxed 1% of that amount.
The minister added that MSMEs will be exempted from stamp tax, documentation fees, and the proclamation of contracts for establishing companies and institutions. This will be in addition to credit facilities contracts, mortgages, and land registration contracts. Customs duties will be reduced from 5% to 2% on machinery, equipment, and devices necessary for the activity.
These advantages, tax incentives and various facilities provided by the law will be activated through the branches of MSMEDA, Gamea noted.
This will occur after the issuance of the executive regulations, which were prepared by the agency and all ministries and authorities concerned with the MSMEs sector, including the Ministry of Finance. The role of each entity will be determined, as well as the services that it provides to business owners and citizens wishing to benefit from the law.