Egypt’s House of Representatives approves covid-19 relief package
LEGISLATION WATCH- Corporate income tax relief program gets House approval: The House of Representatives approved in its plenary session yesterday a bill allowing the government to move ahead with its tax relief package to help companies cope with the economic impact of covid-19. Companies will need to commit to zero layoffs if they sign up for the program, according to Mubasher.
The House also approved the Unified Income Tax Act after the government agreed to raise the exemption threshold to EGP 9k from EGP 7k, according to Mubasher. The bill in its final form also introduced a new top rate for those earning more than EGP 400k per year. The current tax bands will now be as follows:
- Those earning between EGP 15-30k will be taxed 2.5%;
- Those earning between EGP 30-45k will be taxed 10%;
- Those earning between EGP 45-60k will be taxed 15%;
- Those earning between EGP 60-200k will be taxed 20%;
- Those earning between EGP 200k-400k will be taxed 22.5%; and
- Those earning more than EGP 400k will be taxed 25%.
The House failed to convince the government to include annual special bonuses in the wages of state-owned company employees, according to Al Mal. Public Enterprises Minister Hisham Tawfik agreed to reconsider this clause after the covid-19 pandemic is over, but noted that including the bonuses as part of the main salary would raise state companies' expenditures by EGP 700 mn.
Parliament also approved the SMEs Development Act and amendments to the Emergency Law that expand presidential powers to combat the covid-19 pandemic. Reuters took note of the Emergency Law amendments.