Back to the complete issue
Thursday, 11 July 2019

Egypt’s House approves contents of new Social Security and Pensions Act

LEGISLATION WATCH- The House of Representatives’ general assembly approved yesterday the new Social Security and Pensions Act, which would see 21% of the monthly salary of public and private sector workers contributed into a newly-established pension fund, reports Masrawy. The assembly is set to cast its final vote on the bill later today, House Speaker Ali Abdel Aal said, according to the newspaper. Parliament reviewed the final bill with the Council of State (Maglis El Dawla) yesterday to be able to hold the final vote before heading off for their summer recess.

What does the law entail? Under the draft law, employees would contribute 9% of their salaries and the employer would be required to put up 12% into the new fund, sources told us earlier this week. The salary percentage would increase by 1% once every seven years until it hits 26%. The increases would be split down the middle between the employee and the employer, with each seeing their contribution rise by 0.5% every seven years. The law would also set up a committee of actuarial experts to evaluate the social security system and provide advice to the Pensions Authority.

Separately, the House approved yesterday draft amendments that would keep the provisional stamp tax on EGX transactions unchanged at 0.15%, reports Al Mal. A final general assembly vote is still pending. The tax was scheduled to increase to 0.175% on 1 June as part of a plan to hike it annually over a three-year period, but the Finance Ministry called off the increase in a move designed to ease the financial burden on traders.

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.