CAIRO: The Ministry of Finance is currently looking into amending tax laws, whereby real estate and sales tax get collected as value-added tax starting sometime this year.
“Currently, the real estate tax law is not active, giving room for tax evasion and allowing some people to escape from paying taxes, explained Ahmed Shawqi, managing director of the Egyptian Tax Authority. “The new amendments imply that taxes will be reasonable and collected in a more practical way, leaving no room for tax evasion.
A chalet or villa on the North Coast, said Shawqi, is taxable, but people manage to avoid paying because these properties are closed during the winter. “The new policy aims to impose reasonable taxes to encourage more people to pay. It is a [trade-off] because that way the [government] will collect [more] money.
The new amendments transform sales takes into value-added tax.
“A value-added tax applies to all goods and services, unlike the current sales tax that [does not apply to] some services such as legal fees or medical services, Shawqi added.
This will not necessarily mean imposing more taxes, explained Shawqi, because the newly amended sales tax will be lower and more reasonable.
“The ministry’s new policy is to impose reasonable taxes so that people get motivated to abide by the law and pay their taxes. The more taxes you impose, the more tax evasion cases you will face.
