Egypt Ratifies VAT Law
Egypt’s President Abdel Fattah el-Sisi has approved the VAT law completing the ratification procedures needed to bring in the introduction of VAT.
Egypt have been talking about making this change for a while now so for many it is a surprise that is has finally been ratified. This change to a VAT system from their current Sales Tax system will be a big change for Egypt, the bylaws for the new legislation will be issued within 30 days. The rate will come in at 13% for 2016/17 fiscal year then rise 1% to 14% the following year.
One of the governments aims with this VAT law is to increase VAT compliance and decrease Tax evasion. The VAT scheme will be implemented as a traditional VAT scheme where VAT is gathered at every stage of the production chain rather than just as a one-off at the end of the chain as is implemented now. There will still be a list of exempted goods/services.