Back to the complete issue
Tuesday, 4 October 2016

No set date for VAT regs

NO DATE FOR THE VALUE-ADDED TAX REGS? It would be hard to confirm when exactly the executive regulations for the value-added tax (VAT) will be ready as the document is very extensive, said Salah Youssef, head of the Tax Authority’s research department. This comes despite Tax Authority boss Abdel Moneim Mattar saying on Sunday that the regulations will be out this week. Youssef did confirm that they have been drafted and are currently being reviewed by senior officials in the Finance Ministry, Al Mal reports. By law, the government has 30 days from the day a bill is signed into law to issue the executive regulations, which puts the deadline at 9 October.

Lawyers Syndicate believes definition of their profession as “free and independent” means “free and independent of taxes”: Among the surprises that Mattar announced was that lawyers will be getting a break, for no stated reason. And how are lawyers showing their gratitude for the pandering? The Lawyer’s Syndicate has filed suit in the Administrative Court, according to Ahram Online, demanding the VAT legislation be struck down. The suit, filed on Sunday, alleges that lawyers are exempt from paying taxes under Article 198 of the constitution, which defines the profession as “Free” or “independent.” The lawyer among us toils on the day shift at Inktank, so we have no recourse as at dispatch time, but our reading of Article 198 has us questioning the grounds of the claim. Pay your taxes, counsel. If we have to, you have to. The Finance Ministry has already agreed that legal services will be subject to 10% VAT, not the 13% (rising to 14% next year) that other professions will be forced to charge. Check it out for yourself in the Egyptian Constitution of 2014, page 49 (pdf).

Are private medical practices really VAT-exempt? Legal Affairs Minister Magdy El Agaty tells Al Mal that parliament has not amended clauses of the VAT concerning exempting private medical practices from tax. Mattar had announced on Sunday that all non-cosmetic healthcare services and pharma products are VAT-exempt, including private medical practices, so presumably, these will be part of the regs. In the meantime, the Medical and Pharmacist Syndicates have been locked in emergency meetings to figure out how the VAT will affect them and awaiting the regs to be released to get a better idea, Al Borsa reports.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.