Rasha Abdel Aal, Head of the Egyptian Tax Authority (ETA), announced the issuance of a comprehensive guidance manual detailing all aspects of the tax treatment of exported services. The manual aims to clarify the definition of these services under the Value Added Tax (VAT) Law and its executive regulations, explain the rules governing the place of taxation, and specify the documentation required to classify a service as an exported service. It also includes practical scenarios illustrating how VAT applies to the most common cases.
Abdel Aal noted that the manual accompanies the release of Executive Instruction No. 45 of 2025, which sets out the mechanism governing taxpayers’ dealings with exported services, in accordance with directives from the Minister of Finance. She added that the Authority drew on international standards and VAT practices to help ensure the stability and consistency of cross-border commercial transactions.
According to the manual, several situations may qualify for the application of a zero VAT rate on exported services. One such case involves a customer located outside Egypt receiving a remote service from a provider based within Egypt. In such circumstances, the applicable VAT rate is zero, with exceptions for services performed on real estate or those requiring the physical presence of both the provider and the beneficiary in Egypt. Abdel Aal explained that the customer’s country of residence may still impose VAT on remotely supplied services, depending on its national tax regulations.
She emphasized that these measures form part of broader efforts by the Ministry of Finance and the ETA to standardize the tax treatment of services exported abroad and to prevent the double imposition of VAT on the same transaction.
