Egypt is targeting an “exceptional” improvement in its budget debt indicators while implementing a second package of tax facilities that includes cutting value-added tax (VAT) on medical equipment to 5% from 14%, Finance Minister Ahmed Kouchouk said on Tuesday.
Speaking at the Hapi Journal Conference on economic competitiveness, Kouchouk stated that the government aims to strike a balance between supporting economic activity and maintaining fiscal discipline to create additional room for spending on human development.
Kouchouk outlined the details of a “second package” of tax reforms, which he said addresses the country’s permanent business partners with the message: “We are backing you with the greatest amount of support.”
Key measures in the new package include incentives to encourage major companies to list on the Egyptian Exchange, in cooperation with the Financial Regulatory Authority.
In addition to the VAT reduction on medical machinery and equipment, the minister promised “strong and effective” institutional structural changes to make VAT refunds significantly easier and faster.
Regarding small businesses, Kouchouk said a simplified tax system remains in place for startups, professionals, and small enterprises with an annual turnover of up to 20 million Egyptian pounds. He added that the ministry is working with the Micro, Small and Medium Enterprises Development Agency to provide additional incentives and low-cost financing forthe first 100,000 entities to join this simplified system.
On property taxation, Kouchouk announced a shift towards digital services to ease compliance, including a mobile application for real estate disposal taxes. He confirmed the tax rate on property disposals remains unchanged at 2.5% of the sale value, regardless of the number of transactions.
