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Wednesday, 9 January 2019

Tax Authority not looking to impose 10% capital gains tax on all Egypt’s corporates

EXCLUSIVE- Tax Authority not looking to impose 10% capital gains tax on all corporates: The Tax Authority is not planning to impose an across-the-board 10% capital gains tax on all corporates, authority head Abdel Azim Hussein tells Enterprise. According to Hussein, the proposed amendments to the Income Tax Act that look to unify the capital gains tax for listed and privately held companies were drafted by the House of Representatives and have yet to make their way to the Finance Ministry for review or sign-off. Hussein stressed that the levy remains suspended for listed companies until 2020, and that the Finance Ministry has yet to settle on how to impose the tax should it decide to revive it. A separate ministry source also tells us that there are studies underway on the matter.

Background: The House Planning and Budgeting Committee is planning on discussing this week the proposed amendments to the Income Tax Act, Committee Chair Yasser Omar said earlier this week. As it currently stands, the law imposes a 22.5% capital gains tax on unlisted companies, while listed corporations are subjected to a 10% tax. The Mehleb government had half-baked plans in 2015 to impose the tax on retail investors, but ultimately backed down after coming under pressure.

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