(MENAFN- Daily News Egypt)
Egyptian Deputy Finance Minister for Tax Policies, Amr El-Monayer, announced that the figure for Egypt's primary deficit reached EGP 43bn in the period from July 2016 to February 2017—the first eight months of the current fiscal year (FY)—compared to EGP 70bn during the same period of the last FY. He noted that the primary deficit recorded a decline of 40%, while the primary deficit to GDP stood at 1.3%, compared to 2.6% in the last FY.
Primary deficit differs from the total fiscal deficit. While the fiscal deficit is defined as the difference between total revenue and expenditure, primary deficit is being calculated by deducting interest payment from fiscal deficit.
During his meeting with the Tax Commission at the American Chamber of Commerce in Cairo held on Tuesday, El-Monayer said that the non-tax revenue grew by 20% during the first eight months of the current FY. This increase included EGP 6.5bn collected through granting the 4G licenses, while government spending declined by 14.2%. It reflects the government's tendency to rationalise its spending.
He added that his ministry is working on concluding an agreement with different countries to face tax evasion and avoidance in next June or November. This agreement would include specific regulations to counter tax evasion and find solutions to the problem of secret bank accounts. It would also develop a system for the exchange of information related to companies and financiers with a number of other countries.
El-Mounir pointed out that tax revenues grew by 25%, including increases in corporate tax by 27%, tax on wages by 16%, real estate tax by 132%, and VAT by 31% compared to sales tax.
He explained that real estate tax revenue recorded less than EGP 550m during the period from July 2015 until February 2016, while it reached EGP 1.3bn during the period from July 2016 until February 2017. He added that the ministry is working to develop a programme to inventory real estate deeds, noting that the ministry detected more than 600,000 real estate deeds during the last two months.
He said that the ministry has signed a protocol with the Egyptian Bar Association to offer facilitation for young lawyers, so that young lawyers will pay a part of their taxes in the first year, while advisers and Cassation Court lawyers will pay their taxes normally without any facilitation.
El-Monayer pointed out that there will be a meeting at the cabinet to agree on the details of the stamp duty tax on the stock market. The ministry will also prepare new legislation on tax arrears and income tax. On the other hand, he said that the foreign direct investment has increased by 38% during the first eight months of the current FY.
He pointed out that the tax authority has established a centre for senior financiers of private professions.
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