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Thursday, 7 December 2017

House Health Committee lowers proposed tithes on construction materials, healthcare businesses

The House of Representatives’ Health Committee lowers proposed licensing fees imposedon the healthcare sector and a possible new tax on the sale of construction materials before signing off on the Universal Healthcare Act on Tuesday, Al Borsa reports. The committee reduced taxes that would be imposed on construction materials to 0.5% of the value of every tonne sold, with a minimum baseline tax of EGP 5 per tonne. Prior to the amendments, cement companies would have had to pay EGP 20 for every tonne, while steel manufacturers would have paid EGP 50 tax imposed on every tonne sold. Producers of porcelain, marble and granite can expect to pay EGP 5 for every square meter sold. As for licensing fees, the Committee apparently reduced fees on establishing pharmacies, clinics, and hospitals to anywhere between EGP 500-3,000, the newspaper said. Sources had given Al Mal a different fee structure on Monday, so this is yet to be confirmed. As we noted yesterday, the committee had reduced premiums for citizens, so the cut on fees feeding into the system raises new questions about its financing.

To compensate for the cut in funding, the Committee approved raising the contribution ofthe sin tax to the new health system’s budget. EGP 0.75 from the sin tax on every pack of cigarettes will go towards funding the system, up from EGP 0.50, MP Haitham Al Hariri said. The committee had also proposed raising fees for obtaining and renewing drivers licenses. We have yet to see how these amendments would impact the EGP 10 bn deficit in the budget of the universal healthcare system.

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