Issued: 5 September 2016 | Published: Official Gazette No. 35 bis (ج), 7 September 2016 | In force from: 8 September 2016 | Issued by: Abdel Fattah El-Sisi, President of the Republic
Incorporates all amendments through Law No. 3 of 2022 (effective 27 January 2022). Arabic official text is authoritative in all cases. Translation by Consortio Law Firm — Your Safe House.
Egypt replaced its General Sales Tax Law (Law No. 11 of 1991) with a broad-based Value Added Tax effective September 2016. The standard rate is 14%, collected across all stages of supply. A parallel Schedule Tax applies to specific goods and services at separate rates. The law has since been amended three times: Law No. 3 of 2017 added a health insurance dedication on beverage tax revenue; Law No. 206 of 2020 (the Unified Tax Procedures Law) repealed most procedural articles and centralised dispute and enforcement mechanisms; and Law No. 3 of 2022 overhauled the non-resident supplier framework, introducing the Simplified Supplier Registration System, the Reverse Charge Mechanism, and the Non-Resident Registrant concept. All amendments are incorporated inline below.
Promulgating Provisions
Article 1 — Enactment
The provisions of the attached Law on Value Added Tax shall have effect.
Article 2 — Repeal of the General Sales Tax Law
The General Sales Tax Law promulgated by Law No. 11 of 1991 is hereby repealed, as is any provision that conflicts with the provisions of the present Law. The Conciliation and Grievance Committees constituted under the repealed law shall continue to hear the tax disputes referred to them for a period of three months, after which any undecided disputes shall be remitted to the committees provided for in the attached Law.
Article 3 — Terminology Substitution
The phrase “Egyptian Tax Authority” shall be substituted for the phrase “Sales Tax Authority” wherever it appears in applicable laws, decisions, and regulations.
Article 4 — Continuation of Existing Registrants
A person registered under the General Sales Tax Law shall retain their registration number where their sales have reached or exceeded the registration threshold set out in the attached Law. Every producer or importer of a Schedule good listed under the General Sales Tax Law whose good also appears in the Schedule to the attached Law shall likewise retain their registration regardless of the volume of their transactions. All such persons shall comply with the provisions of the attached Law in full.
Such persons shall also remit the General Sales Tax due from them within the deadlines prescribed in the attached Law and retain their accounting books, records, and documents for five years from the date on which the present Law enters into force, in accordance with the Executive Regulations.
In the event of any breach of the preceding paragraphs, the registered person shall be deemed to have committed tax evasion, and the Authority shall be entitled — on the basis of any data or documents available to it — to take the necessary measures and issue administrative decisions to collect the outstanding sales tax. The registered person shall have the right to appeal such decisions under the attached Law.
Article 5 — Automatic Cancellation of Sub-Threshold Registrations
The registration of any person who has not reached the registration threshold set out in the attached Law shall be automatically cancelled unless that person requests, within sixty days from the date on which the present Law enters into force, the continuation of their registration.
A person whose registration has been cancelled shall file a tax return for the final tax period before cancellation, as well as for any tax periods whose filing deadline has not yet fallen due, within thirty days from the date on which the present Law enters into force, indicating the closing balances of finished goods, raw materials, and services. Such persons shall discharge all amounts due within six months from the date on which the present Law enters into force, retain their books, records, and documents for five years from the date of cancellation of their registration, and make them available for inspection by the Authority’s officers.
The Authority shall be entitled — on the basis of any documents or data available to it — to amend the returns and take the necessary legal measures to collect the tax due. Any person whose registration has been cancelled shall have the right to appeal such measures under the attached Law.
Article 6 — Credit for Pre-existing General Sales Tax
A person registered under the present Law and the attached Law shall be entitled to deduct the amount of General Sales Tax represented by any credit balance standing in their favour before the present Law entered into force, as well as any General Sales Tax previously paid but not yet deducted or refunded on goods, machinery, equipment, and spare parts in their possession on the date on which the present Law enters into force. The Registrant shall likewise be entitled to settle the Schedule Tax now due on passenger vehicles in their possession against the sales tax previously paid on those same vehicles, all subject to the conditions and controls prescribed by the Executive Regulations.
General Sales Tax previously paid on goods and services exported abroad, or on their inputs, as well as tax paid in error, shall be refunded in accordance with the procedures and rules set out in the attached Law.
Article 7 — Alignment Period and Surcharge Waiver
Without prejudice to the provisions of the present Law and the attached Law, every person whose registration continues under the present Law, or who is registered under the attached Law, shall align their positions within three months of the date on which the present Law enters into force. Registrants shall be exempt from the Surcharge in respect of VAT and Schedule Tax differentials lawfully due during this period where the computation of those differentials depends upon the alignment of their positions. The Executive Regulations shall set out the decisions and rules governing the alignment of positions.
Article 8 — Treaty Exemptions Savings Clause
The provisions of the present Law and the attached Law shall not prejudice exemptions granted under agreements concluded between the Egyptian Government and foreign states, international or regional organisations, or petroleum and mining agreements.
Article 9 — Executive Regulations
The Minister of Finance shall issue the Executive Regulations to the present Law and the attached Law within thirty days of the date of publication thereof. Pending their issuance, existing regulations and decisions shall continue to apply to the extent that they do not conflict with the provisions of either Law.
Article 10 — Publication and Entry into Force
This Law shall be published in the Official Gazette and shall enter into force on the day following the date of its publication. This Law shall be sealed with the State seal and enforced as one of its laws.
The Value Added Tax Law
(Attached to Law No. 67 of 2016)
Chapter One: Definitions
Article 1 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
For the purposes of applying the provisions of this Law, the following terms and expressions shall have the meanings assigned to them below:
“Minister”: the Minister of Finance.
“Authority Head”: the Head of the Egyptian Tax Authority.
“Authority”: the Egyptian Tax Authority.
“Taxable Person”: any natural or legal person, whether private or public, responsible for collecting and remitting the Tax to the Authority — including any producer, trader, or service provider in respect of a good or service subject to Tax whose sales have reached the registration threshold prescribed in this Law; any importer, exporter, or distribution agent in respect of a taxable good or service regardless of the volume of their transactions; and any producer, service provider, or importer of a good or service listed in the Schedule appended to this Law regardless of the volume of their transactions.
“Registrant”: a Taxable Person who has been registered with the Authority in accordance with the provisions of this Law.
“Related Party”: any person connected to another person by a relationship that affects the determination of the tax base, including: (1) spouses and lineal ascendants and descendants; (2) a capital company and any person who holds, directly or indirectly, at least 50% of the number or value of its shares or voting rights; (3) a partnership and its jointly liable partners and limited partners; (4) any two or more companies in each of which another person holds at least 50% of the number or value of the shares or voting rights; (5) an employer and the employees subordinate to them bound by an employment relationship.
“Service Provider”: any natural or legal person who supplies or performs a service subject to Tax.
“Importer”: any natural or legal person who imports goods or services subject to Tax, whatever the purpose of the importation.
“Resident”: a natural or legal person who is considered resident in Egypt in accordance with the provisions of the Income Tax Law.
“Permanent Establishment”: the fixed place through which the activity is carried on, including the place of management; a branch, office, factory, or workshop; a mine, oil field, gas well, quarry, or any other place of extraction of natural resources; and a building site or a construction or installation project. A person who has a Permanent Establishment in Egypt shall be subject to the provisions of this Law.
“Tax”: the Value Added Tax.
“Surcharge”: a tax at the rate of 1.5% of the unpaid Tax or Schedule Tax — including tax arising from an amendment to a return — for each month or part thereof from the end of the prescribed payment period until the date of payment.
“Input Tax”: the Tax borne by the Taxable Person upon the purchase or importation of goods — including machinery, equipment, and services — whether directly or indirectly, in connection with the sale of a taxable good or the performance of a taxable service.
“Schedule Tax”: a tax levied at special rates or fixed amounts on the sale or importation of domestic or imported goods and services listed in the Schedule appended to this Law, distinct from the Tax referred to in the first paragraph of Article (2) of this Law, unless the Schedule provides otherwise.
“Good”: any tangible thing, whatever its nature, origin, or purpose — including electrical energy — whether domestic or imported; the classification of a good shall be guided by the notes and texts of the headings set out in the sections and chapters of the applicable Customs Tariff Schedules.
“Service”: anything that is not a Good, whether domestic or imported.
“Exempt Goods and Services”: the goods and services included in the Exemptions List appended to this Law.
“Sale”: the transfer of ownership of a good or the performance of a service by the seller — even if the seller is an importer — to the buyer; the following shall each constitute a Sale for the purposes of this Law, whichever occurs first: the issuance of an invoice; the delivery of the good or the performance of the service; or the payment of the price of the good or the consideration for the service, whether in full or in part, on a deferred basis, or in any other form in accordance with the applicable payment terms.
“Tax Invoice”: an invoice prepared in accordance with the template issued by a decision of the Minister or his delegate.
“Month”: a calendar month.
“Tax Period”: a period of one month ending on the last day of the calendar month in respect of which the Registrant submits their monthly tax return.
“Financial Year”: a period of twelve months commencing at the beginning of the Taxable Person’s financial year and ending at the close thereof.
“Personal Consumption”: the use of a good or the benefit derived from a service for purposes unrelated to the business activity.
“Own Use”: the use of a good or the benefit derived from a service for purposes related to the business activity; the transfer of a good between stages of production within or outside the establishment shall not constitute Own Use.
“Non-Resident Registrant”: a non-resident natural or legal person who is required to register for VAT and to account for it upon completing sales of goods or upon supplying services to non-registered customers in Egypt.
“Simplified Supplier Registration System”: a system that allows non-resident suppliers to register on a simplified basis.
“Reverse Charge Mechanism”: a system under which the recipient of a good or service is required to account for and pay the Tax directly to the Authority instead of the non-resident supplier, in the circumstances prescribed in this Law.
Chapter Two: Value Added Tax
Section One: Levy and Accrual of Tax
Article 2 (as amended by Law No. 3 of 2017, effective 16 January 2017)
Tax shall be levied on goods and services — including goods and services listed in the Schedule appended to this Law — whether domestic or imported, at all stages of their circulation, except as otherwise expressly provided.
A sum of forty piastres (EGP 0.40) per litre shall be dedicated from the Tax revenue collected on item (First: 1/b/3) of the Schedule appended to this Law, to be paid to the General Authority for Health Insurance. The Minister of Finance shall, in agreement with the Minister of Health, determine the rules for paying this amount.
Article 3
The standard rate of Tax on goods and services shall be 13% for the financial year 2016/2017, and 14% from the financial year 2017/2018, of which 1% shall be allocated to the funding of social justice programmes. By way of exception, the rate of Tax on machinery and equipment used in the production of a good or the performance of a service shall be 5%, excluding buses and passenger vehicles.
The rate of Tax on goods and services exported outside the country shall be zero (0%), subject to the conditions and procedures set out in the Executive Regulations.
Article 4
Taxable Persons shall be required to collect the Tax, file returns in respect thereof, and remit it to the Authority within the deadlines prescribed in this Law.
Article 5 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
Tax shall become due upon the occurrence of the taxable event of the sale of a good or the performance of a service by Taxable Persons at all stages of their circulation in accordance with the provisions of this Law, by whatever means the sale, performance, or circulation is effected, including through electronic means.
In respect of imported goods, Tax shall become due — whatever the purpose of the importation, including for Personal Consumption or Own Use — at the stage of their clearance from customs upon the occurrence of the event giving rise to customs duty; Tax shall likewise become due at all stages of their circulation within the country following clearance. The rules applicable to special customs regimes shall apply in respect of imported goods to the extent not otherwise provided in this Law.
In respect of imported services, Tax shall become due upon the occurrence of the taxable event of the performance of the service to its recipient in Egypt, by whatever means the service is performed.
Tax shall not become due on goods in transit, provided that their carriage is subject to the supervision of the Customs Authority in accordance with the rules prescribed by the Customs Law.
A Taxable Person’s use of a good or benefit from a service for purposes of Personal Consumption, Own Use, or any legal act of disposal shall be deemed to constitute a Sale.
Tax on imported goods shall not be collectible upon customs clearance if it is established that such Tax has been collected by the Non-Resident Registrant.
Article 6 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
Goods and services supplied by projects in the free zones, free cities, and economic special nature areas shall be subject to Tax at a zero rate (0%).
Goods or services supplied to these projects and required for the licensed activities operating within the free zones, free cities, and economic special nature areas shall likewise be subject to Tax at a zero rate (0%), excluding motor vehicles of a special nature.
Article 7 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
Without prejudice to the second paragraph of Article (6) of this Law, Tax shall become due on goods or services of the kind subject to Tax under this Law that are supplied to the free zones, free cities, and economic special nature areas for Personal Consumption or local consumption within those areas.
Trade in free zone areas shall be deemed to constitute local retail trade for the purposes of this Law.
Tax shall likewise become due — in accordance with the provisions of this Law — on any good imported or any service supplied from the free zones, free cities, and economic special nature areas into the domestic market inside the country.
Manufactured goods and services produced in the free zones, free cities, and economic special nature areas shall be treated as domestic goods and services upon their withdrawal for Personal Consumption or use in the domestic market.
The Executive Regulations shall determine the limits and rules governing this Article and Article (6) of this Law.
Article 8
In the event of cessation of or liquidation of an activity involving a good or service subject to Tax, Tax shall become due on goods in the Registrant’s possession at the time of their disposal, unless the successor is registered or has registered themselves in accordance with the provisions of this Law.
Article 9
Without prejudice to the penalties provided for in this Law, smuggled goods and goods sold in violation of applicable rules shall be subject to the tax rates in force at the date on which the offence or violation occurred; if it is impossible to determine that date, such goods shall be subject to the tax rates in force at the time of seizure or discovery of the violation.
Section Two: Value (Tax Base)
Article 10
(1) The taxable value to be declared, and which shall serve as the basis for assessment of Tax in respect of the sale of goods or services subject to Tax — whether imported or not — shall be the price actually paid or payable in any form in the ordinary course of business.
(2) The taxable value referred to in paragraph (1) of this Article shall include: (a) amounts collected from the buyer or the recipient of the service under any designation, provided they are connected with the sale of goods or the performance of services; and (b) all incidental charges such as commission, packaging, stowage, transport, and insurance costs imposed by the seller on the buyer or the importer.
(3) In the case of a sale of a domestic or imported good or service between Related Parties, the sale value must not fall below the price at which a transaction would take place between unrelated persons in accordance with market forces and commercial circumstances.
(4) In the case of a barter sale, the value of the good serving as the basis for tax assessment shall be its market price in accordance with market forces and commercial circumstances.
(5) The taxable value in respect of goods or services for Own Use shall be determined on the basis of total cost; the taxable value in respect of goods or services for Personal Consumption shall be determined at the market price in accordance with market forces and commercial circumstances.
(6) In respect of instalment sales, the taxable value shall include interest charged in excess of the discount and credit rate published by the Central Bank at the date of sale; the Executive Regulations shall determine the rules and procedures governing instalment sales.
(7) Without prejudice to paragraph (8) of this Article, the value of goods imported from abroad shall be assessed at the customs clearance stage on the basis of the value used for customs duties, inclusive of services related to the imported good, plus customs duties and other applicable taxes and charges. The taxable value to be declared upon sale in the domestic market shall not be less than the value used as the tax base at customs clearance, unless there are commercial reasons justifying the lower value, as defined by the Executive Regulations.
(8) The tax base for goods and services imported from free zones and free cities shall be the full value of the good inclusive of its foreign and domestic components plus customs duties and other applicable taxes and charges assessed thereon.
(9) The value serving as the basis for Tax assessment on the sale of platinum, gold, and silver articles and precious stones shall be the workmanship (manufacturing) value; in the case of customs clearance of imported articles, the tax base shall be the workmanship value as determined by the Customs Authority, plus customs duties and other applicable taxes and charges; the Executive Regulations shall define what constitutes precious stones and the rules for computing the workmanship value.
(10) The value serving as the basis for Tax assessment on sales of goods and services listed in the Schedule appended to this Law shall be determined as follows: First — in respect of domestic goods and services: the price actually paid or the amount due in any form in the ordinary course of business, plus the Schedule Tax where applicable. Second — in respect of imported goods and services: (a) imported goods: the value used for customs duty assessment, inclusive of customs duties and other applicable taxes and charges, plus the Schedule Tax; (b) imported services: the price actually paid or the amount due in any form in the ordinary course of business, plus the Schedule Tax.
(11) The value serving as the basis for Tax assessment on new goods purchased by a Taxable Person and subsequently sold after domestic use for a period of not less than two years shall be 30% of the sale value, without applying the deduction provisions of Article (22) of this Law upon sale.
(12) The Minister, in agreement with the competent minister, may issue price lists for certain goods or services or establish accounting bases to serve as the basis for tax assessment.
Article 11
The value of the Tax shall be added to the price of goods or services, including price-controlled and profit-regulated goods and services.
The prices of contracts concluded between Taxable Persons, or between parties one of whom is a Taxable Person, that are in force at the time of the imposition of the Tax or Schedule Tax — or upon the amendment of their rates — shall be adjusted by the amount of the Tax burden or its amendment; the Executive Regulations shall determine the rules for applying the second paragraph of this Article.
Section Three: Invoices, Returns, Notifications, Books, and Records
Article 12 — Repealed by Law No. 206 of 2020 (Unified Tax Procedures Law), effective 20 October 2020.
Original text: A Registrant was required to issue a Tax Invoice upon the sale of a taxable good or the performance of a taxable service, stating the buyer’s name and registration number if the buyer was registered; the Executive Regulations determined the required particulars. The Minister could establish simplified systems for establishments that found it impracticable to issue a Tax Invoice for each transaction, and could require certain Registrants not to issue invoices unless approved by the Authority.
Article 13 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: A Registrant was required to maintain regular accounting books and records, manually or electronically, recording all transactions, and to retain such books, records, and documents — including copies of invoices — for five years following the end of the financial year in which the relevant entry was made.
Section Four: Registration
Article 14 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
The Authority shall have the right to assess the Tax for any Tax Period in respect of which the Registrant has not submitted a return, with a statement of the bases relied upon for the assessment.
Original text: Every Registrant was required to submit a monthly return for VAT and Schedule Tax on the prescribed form within two months following the end of the Tax Period, with the April return due by 15 June at the latest. A Registrant was required to file even if no taxable activity occurred. If the Registrant failed to file by the deadline, the Authority could assess the Tax for that period, stating the bases relied upon, without prejudice to criminal liability.
Article 15 (as amended by Law No. 206 of 2020, effective 20 October 2020)
If the Authority amends a return after the expiry of the first three years from the deadline for its submission, it may not charge the Surcharge for the period following the expiry of those three years until the date of notification of the amendment to the Registrant.
Original text: The Authority could amend any return within five years from the filing deadline. If the amendment occurred after three years, the Surcharge was not chargeable for the post-three-year period. The Authority was required to notify the Registrant of the amendment and bases relied upon by registered mail, electronic means with evidentiary force, or any other certified written means. The Registrant had the right of appeal in accordance with the procedures prescribed in this Law.
Article 16 (as amended by Law No. 206 of 2020, effective 20 October 2020)
Every natural or legal person who sells a taxable good or provides a taxable service and whose aggregate sales of taxable and exempt goods and services during the twelve months preceding the date on which this Law enters into force have reached or exceeded EGP 500,000 shall apply to the Authority for registration on the prescribed form within thirty days of the date on which their sales reach the registration threshold. A person whose sales reach that amount after this Law enters into force, in any financial year or part thereof, shall likewise apply to the Authority. This obligation does not apply to a natural person not engaged in carrying on a business of selling goods or providing services simply because their incidental sales reach the threshold mentioned.
Every importer of a taxable good or service for trading purposes, every exporter, and every distribution agent shall register with the Authority regardless of the volume of their transactions.
The Minister may, by decision, amend the registration threshold.
Article 17 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
Every non-resident, non-registered person who sells goods or provides taxable services to a non-registered person inside the country and does not carry on an activity through a Permanent Establishment in Egypt shall apply for registration under the Simplified Supplier Registration System as determined by the Executive Regulations.
Legal persons who do not sell goods or provide taxable services but are subject to the obligation to account for Tax on imported services under the second paragraph of Article (32) of this Law shall apply to the Authority for registration for purposes of the Reverse Charge Mechanism.
The provisions of this Article shall apply to services within six months from the date on which the Simplified Supplier Registration System enters into force, and to goods within a period not exceeding two years from that date.
Original text: Every non-resident, non-registered person was required to appoint a representative or agent in Egypt responsible for all Taxable Person obligations under this Law, including registration, payment of Tax, Surcharge, and other taxes due. The Egyptian Resident was required to verify that the non-resident had appointed such a representative; failing that, the Resident transacting with them was required to pay the Tax and other taxes due to the Authority, without prejudice to their right of recourse against the non-resident.
Article 18
A natural or legal person who has not reached the registration threshold may apply to the Authority to register their name and details in accordance with the conditions, terms, and procedures determined by the Executive Regulations; upon registration, they shall be treated as a Taxable Person subject to the provisions of this Law.
Article 19 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: The Authority maintained a register of registration data and issued a registration certificate to each Registrant; the Executive Regulations determined the requirements and procedures for such certificates and the data they must contain.
Article 20 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: Every Registrant was required to notify the Authority in writing of any changes to their registration data within twenty-one days of the occurrence of such changes.
Article 21
The Authority Head may cancel registration in the circumstances, conditions, and terms determined by the Executive Regulations.
Section Five: Input Tax Deduction and Exemptions
Article 22 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
The Registrant shall, when computing the Tax due, deduct from the Tax due on the value of their sales of goods and services the Tax previously paid or charged on their returned sales, and the Tax previously charged on their inputs, including the Tax previously charged on goods and services sold by the Registrant at each stage of their distribution, in accordance with the conditions, limits, and terms set out in the Executive Regulations.
The first paragraph shall likewise apply to: (1) goods and services supplied to the entities referred to in Article (23) of this Law and to exempt entities; and (2) goods and services exempted from Tax by a decision of a competent cabinet member.
The deduction shall be made up to the amount due, and any excess shall be carried forward to subsequent Tax Periods until fully exhausted.
The deduction referred to in the first paragraph shall not apply to: (1) Schedule Tax on goods or services whether in themselves or as inputs, except as otherwise provided in this Law; (2) Tax on inputs included within the cost; (3) exempt goods and services; or (4) transactions covered by the Simplified Supplier Registration System referred to in the first paragraph of Article (17) of this Law.
Article 23
The following shall be exempt from Tax on the condition of reciprocity and within the limits determined by the Executive Regulations:
(1) Goods purchased or imported for the Personal Use of foreign diplomatic and consular officers not listed in the tables published by the Ministry of Foreign Affairs, and likewise goods purchased or imported for the Personal Use of their spouses and minor children.
(2) Goods purchased or imported by embassies, legations, and consulates for official non-honorary use, including food, beverages, and tobacco.
(3) Goods imported for Personal Use, on the condition of reciprocity, by foreign officials of diplomatic missions who are not entitled to the exemption under item (1), provided that importation takes place within six months of the date of arrival of the beneficiary.
Exemptions under this Article shall be granted after approval by the Head of the diplomatic or consular mission, as applicable, and certification by the Ministry of Foreign Affairs. The number of vehicles covered shall be determined at one vehicle for personal use and two vehicles for official mission use, subject to agreement with the Minister of Foreign Affairs, who may agree to increase this number.
Article 24
Disposal of items exempted pursuant to Article (23) of this Law for purposes other than those for which the exemption was granted is prohibited during the five years following the grant of the exemption, unless the Authority is notified in advance, the Tax due on those items is paid at the rates in force at the date of disposal in accordance with their then-current value, and the principle of reciprocal treatment does not preclude the application of the prohibition. The Executive Regulations shall determine the rules and procedures governing this Article.
Article 25
The Minister, in agreement with the Minister of Foreign Affairs, may by decision exempt goods imported for Personal Use by certain foreign nationals of distinction for purposes of international courtesy.
Article 26
The following shall be exempt from Tax within the limits and conditions determined by the Executive Regulations: (1) samples consumed in the course of analysis in government laboratories; (2) personal effects and belongings of a purely non-commercial character, such as medals, decorations, and sports and scientific prizes; (3) replacement items received from abroad at no charge in substitution for damaged or deficient items from previously accepted or refused consignments on which Tax was previously collected in full, subject to verification by the Customs Authority; (4) personal baggage belonging to travellers arriving from abroad; (5) items on which Tax was previously paid, subsequently exported, and then re-imported, subject to verification by the Customs Authority.
Article 27 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
The Minister, in agreement with the competent minister, may by decision exempt certain goods and services from Tax in the following two cases: (1) gifts, donations, and grants to the State, local administration units, or public authorities; and (2) goods imported for scientific, educational, or cultural purposes by scientific and educational institutes and scientific research institutes.
Article 28
All goods, equipment, devices, and services covered by this Law that are necessary for armament purposes for national defence and security shall be exempt from Tax, as shall raw materials, production requisites, and component parts entering into their manufacture.
Article 28 bis
Payment of Tax due on machinery and equipment imported from abroad or purchased from the domestic market for use in industrial production shall be suspended for a period of one year from the date of customs clearance or domestic purchase. For justified reasons, this period may be extended for one or more further periods, provided the total does not exceed one additional year.
If the Authority establishes that such machinery and equipment has been used in industrial production, it shall be exempt from Tax. In that case, disposal of the machinery or equipment is prohibited during the five years following the exemption, except after notifying the Authority and paying the Tax then due at the rate in force at the date of payment and in accordance with its then-current value.
If the suspension period expires without the machinery and equipment having been used in industrial production, the Tax and Surcharge due shall become payable from the date of customs clearance or domestic purchase until the date of payment.
The Executive Regulations shall determine the rules and procedures governing this Article.
Article 29
Without prejudice to Article 8 of the Promulgating Provisions, Tax exemptions provided for in other promulgating laws, decisions, and other legislation shall not apply to this Tax unless the Schedule expressly provides for such exemption.
Section Six: Tax Refund and Collection
Article 30 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
Tax shall be refunded in accordance with the conditions and procedures set out in the Executive Regulations within forty-five days from the date of submission of the application with supporting documents, in the following cases:
(1) Tax previously paid on goods and services that have been exported or incorporated into an exported good or service, provided that the value of the exports is not less than the value of their inputs and that export receipts are remitted through a bank subject to Central Bank supervision in accordance with the controls prescribed by the Executive Regulations or any other settlement method it determines.
(2) Tax collected in error.
(3) A credit balance outstanding against the Registrant for more than six consecutive Tax Periods.
(4) Tax previously paid on machinery and equipment used in the production of a taxable good or service, as of the date of filing the first tax return for the establishment.
(5) Tax borne by a non-resident Registrant registered under the Simplified Supplier Registration System.
In all cases, the supporting documents on file must include evidence establishing the Taxable Person’s entitlement to the Tax deduction or refund, certified by a chartered accountant registered with the accountants’ register, and the refund shall be confirmed electronically where the Tax has not been registered electronically.
Article 30 bis
Foreign visitors departing the country who have been present for a period not exceeding three months shall be entitled to a refund of Tax previously paid to licensed sellers on their purchases of taxable goods, provided that the value of each single invoice is not less than EGP 1,500 and on condition that the goods leave the country in the visitor’s accompaniment or by other means. The Executive Regulations shall determine the rules governing application of this Article.
Article 31 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
Government ministries, authorities, local administration units, and other public legal persons shall be required to remit the Schedule Tax due from them directly to the Authority within ten days of the date on which it falls due. Such entities shall likewise be required to remit 20% of the VAT due from them as a payment on account of the Tax within the same period; in such cases the Authority may not demand from the Taxable Person collection of what has already been remitted.
Without prejudice to Article (28 bis) of this Law, the Authority Head or their delegate may grant temporary customs release of consignments required for productive activities or business operations, against such guarantees as the Customs Authority deems appropriate, pending the Taxable Person’s settlement of the Tax and any Surcharge accruing from the date of release.
Original text: A Registrant was required to pay their Tax revenue to the Authority with their monthly return by the prescribed deadline. Tax on imported goods was payable at customs clearance in accordance with the procedures for customs duties; final clearance could not be granted before the Tax due was paid in full. If Tax was not paid by the deadline, the Surcharge became due.
Article 32 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
Where a non-resident, non-registered person sells goods or provides taxable services to a non-registered person inside the country and does not carry on an activity through a Permanent Establishment in Egypt, the Egyptian Resident recipient of the imported services shall be required to account for and pay the Tax on those services to the Authority within thirty days of the date of the sale, unless the non-resident is registered under the Simplified Supplier Registration System.
Legal persons subject to the Reverse Charge Mechanism obligation for imported services under the second paragraph of Article (17) of this Law shall account for and remit the Tax due on such services to the Authority within thirty days of the date of supply, where the non-resident person providing the service is not registered under the Simplified Supplier Registration System.
Original text: Every non-resident, non-registered person providing taxable goods or services in Egypt without a Permanent Establishment was required to appoint a representative or agent in Egypt responsible for all Taxable Person obligations. The Egyptian Resident was required to verify the appointment; failing that, the Resident was required to pay the Tax due to the Authority, without prejudice to the right of recourse against the non-resident.
Article 33
For the purposes of this Law, the issuance of the invoice by the service provider shall constitute the taxable event giving rise to Tax liability in respect of services of a continuous nature; the Executive Regulations shall define the nature of such services.
Article 34 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: In the collection of Tax and other amounts due under this Law, the provisions of Law No. 308 of 1955 on Administrative Attachment applied to all companies and establishments regardless of legal form.
Article 35 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: Set-off was effected between amounts due to the Authority from the Registrant and amounts owed by the Authority to the Registrant, as well as any amounts due from the Authority as revenues of financial authorities within the Ministry of Finance.
Chapter Three: Schedule Tax
Article 36
Schedule Tax shall be levied on the sale, provision, or importation of goods and services listed in the Schedule at the rate indicated therein, in addition to VAT as prescribed in Article (2) of this Law. The rate of Schedule Tax on exported goods and services shall be zero (0%), subject to the conditions and procedures determined by the Executive Regulations.
Schedule Tax shall not be levied again on a good unless a change occurs in the state of that good. The following shall not constitute a change of state for the purposes of this Article: packing or re-packing, refining and purification, or grinding.
This provision shall not prevent the application of the VAT prescribed in Chapter Two of this Law to goods and services listed in the Schedule, except as otherwise provided in that Schedule.
Article 37
The Registrant shall have the right to settle Schedule Tax previously paid on components, machinery, equipment, and waste used in the production of goods subject to Schedule Tax, up to the limit of the Schedule Tax due. The Registrant shall likewise have the right to settle Schedule Tax previously paid on returned sales in accordance with the conditions and terms determined by the Executive Regulations.
Article 38
Schedule Tax shall become due on goods and services listed in the Schedule once, upon the first sale, importation, or provision of the service. Without prejudice to the Tax prescribed in Chapter Two of this Law, this Article shall apply to Schedule goods and services that take the form of gifts or promotional offers, the value of which shall be determined in accordance with market forces and commercial circumstances. The Executive Regulations shall define the nature of promotional offers.
Article 39
The taxable value serving as the basis for Schedule Tax assessment on goods and services listed in the Schedule shall be as follows: (a) for domestic goods and services: the price actually paid or the amount due in any form in the ordinary course of business; (b) for imported goods and services: the value used for customs duty assessment plus customs duties and other applicable taxes and charges — all as specified in the Schedule, unless the Schedule provides otherwise.
Article 40
In the event of any good or service being newly made subject to Schedule Tax, or the applicable Schedule Tax rate being increased, importers, wholesalers, semi-wholesalers, retailers, and distributors shall be required to submit to the Authority a statement of the balance of such goods and services in their possession on the day preceding the date on which the new or increased Schedule Tax enters into force. The statement shall be submitted within fifteen days of that effective date, and the new or increased Schedule Tax shall become due on the date the statement is submitted. The Schedule Tax due on these goods and services shall be paid within a period determined by the Authority Head, not exceeding six months from the due date.
Article 41
Every producer, provider, or importer of goods or services listed in the Schedule appended to this Law shall register with the Authority regardless of the volume of their sales or production.
Article 42
No factory, workshop, or premises may be established or operated for the production of any good or the provision of any service listed in the Schedule without first obtaining a permit from the competent administrative authority in accordance with the conditions prescribed by the Minister, in agreement with the competent minister.
Every producer of a good or provider of a service listed in the Schedule shall notify the Authority of any cessation — whether total or partial — of work at the factory or workshop through which the good is produced or the service provided, and shall likewise notify the Authority immediately upon the end of the cessation period, all in the manner determined by a decision of the Authority Head.
Article 43
The provisions of this Law shall apply to goods and services listed in the Schedule appended thereto to the extent not otherwise provided in this Chapter and the Schedule.
Chapter Four: General Provisions, Control, and Appeal Procedures
Section One: General Provisions
Article 44
Without prejudice to any specific provision in this Law, disposal of goods exempted from Tax or Schedule Tax for purposes other than those for which the exemption was granted is prohibited during the five years following the grant of the exemption, unless the Authority is notified in advance and the Tax due is paid at the rates in force at the date of disposal in accordance with their then-current value. In all cases, the value of the Tax refund or exemption may not exceed the Tax due.
Article 45
The Authority may, where necessary, take samples of certain goods for analysis purposes, engaging experts if it sees fit. The interested party may request re-analysis at their own expense. The Minister shall issue a decision specifying the methods and procedures for taking samples.
Article 46
The Executive Regulations shall determine the amounts collected by the Authority as charges for printed materials, stamps, distinctive marks, or seals, or as consideration for affixing seals or for analytical services performed by Authority officers, or as compensation for work performed by Authority employees outside official working hours for the benefit of account holders. These amounts shall not fall within the scope of Tax or Schedule Tax refund or exemption under this Law.
Article 47
Without prejudice to the provisions of the Customs Law, the Authority has the right to dispose of seized goods, smuggling instruments, and means of transport in respect of which confiscation has been ordered, in accordance with the rules determined by the Executive Regulations.
The Authority may, by court order issued prior to judgment, dispose of seized items that are liable to spoilage, diminution, or loss. The Authority shall likewise have the right to destroy goods whose circulation is prohibited, or which are harmful to public health, or whose offering for sale raises concern for the security and safety of citizens, after obtaining the opinion of the competent technical authorities.
Article 48 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: In no case could the Authority carry out Tax or Schedule Tax assessments, or amend Registrant returns, except on the basis of data or documents available to it and within five years from the filing deadline. This period was ten years if the Registrant was a tax evader. The period was interrupted for any reason provided by civil law, or upon notification of the assessment, or upon referral to the appeal committees.
Article 49
With respect to imported taxable goods that have not been cleared through customs, the customs violations and tax evasion provisions of the Customs Law shall apply.
Article 50 (as last amended by Law No. 3 of 2022, effective 27 January 2022)
The Taxable Person shall pay to the Authority an amount equal to 1% of the Tax and Schedule Tax due, not less than EGP 1,000 and not more than EGP 10,000, in addition to the Tax, Schedule Tax, and Surcharge due, where they violate the provisions, procedures, or systems prescribed in this Law in a manner that does not constitute an act of tax evasion. The following shall be deemed violations: (1) discovery of a shortage or surplus of goods in the free zones and free cities in contravention of the Customs Law; (2) failure to notify the Authority of changes to registration data by the prescribed deadline; (3) violation of any provisions, procedures, or systems prescribed in this Law. The penalty shall be doubled in the event of repetition of any of the listed acts within three years.
Original text: Debts due to the Authority from a Registrant could be written off in cases of final bankruptcy, departure from the country for more than ten years with no assets, no attachable assets, or death leaving no estate. Write-offs required committee approval and could be revoked if based on incorrect grounds.
Article 51 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: VAT, Schedule Tax, the Surcharge, and other amounts due to the Authority had a lien over all assets of the persons obliged to pay or collect and remit them, with priority over all other debts except court costs.
Section Two: Control and Inspection
Article 52
The Executive Regulations shall regulate the control systems for the documents and records of Registrants, as well as the POS systems and electronic invoicing systems used by them in selling goods or providing taxable services, with a view to verifying Registrant compliance. The Minister or their delegate may set reporting rules and administrative procedures for applying this Law in a manner consistent with the nature of the Registrant’s activity.
Article 53 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: The Minister could establish systems to enable the Authority to access Tax returns and data or images of Tax Invoices electronically. The Minister could require certain establishments to use cash registers or POS terminals showing the value of sales and Tax and Schedule Tax due.
Article 54
No legal effect shall be given to any transaction whose principal purpose, or one of its principal purposes, is the avoidance of VAT or Schedule Tax, the deferral of either, or the reduction of the tax burden due. The following shall be deemed tax-avoidance transactions for the purposes of this Article:
(1) Transactions taking place between Related Parties in the sale of taxable goods and services, the purpose of which is for any or all of them not to reach the registration threshold prescribed by law.
(2) Establishing or dividing companies, or splitting transactions, for tax purposes.
Where a transaction is characterised as tax avoidance, the Authority shall be entitled to obligate the Taxable Person to register or to pay the Tax on the basis of the actual value in accordance with market conditions and the forces of commercial dealing — all without prejudice to the Taxable Person’s right to prove that the transaction was carried out for purposes other than tax avoidance.
A committee shall be constituted, chaired by the Authority Head or their delegate, with the membership of at least two Authority officers holding a position of Director General or above, with competence to examine avoidance cases; its decisions shall be binding on the competent tax office.
Section Three: Appeal Procedures
Note: Articles 55–61 were repealed by Law No. 206 of 2020 (the Unified Tax Procedures Law), which consolidated all tax dispute and appeal mechanisms into a single procedural framework. Original texts are retained below for reference.
Article 55 — Repealed by Law No. 206 of 2020.
Original text: Notification was by registered mail with acknowledgement of receipt, by any electronic means with evidentiary force under the Electronic Signature Law, or by any certified written means. Notification at the establishment address constituted legal notification. In case of absence, the Authority employee recorded the matter and posted notice. The Registrant could appeal the Authority’s assessment to the Internal Committee within sixty days of notification, suspending Tax payment up to the disputed amount. Cases not resolved within two years were referred to appeal committees.
Article 56 — Repealed by Law No. 206 of 2020.
Original text: In all cases of Tax assessment or amendment, the Authority notified the Registrant. The Registrant had sixty days from notification to file a written objection with the competent Authority office on a special form, stating the disputed Tax amount and the grounds of objection. The Authority constituted internal committees to resolve disputes within two years of the objection’s receipt.
Article 57 — Repealed by Law No. 206 of 2020.
Original text: Internal committees examined Tax disputes and consisted of at least three Authority members deciding by majority. If not resolved within the deadline, disputes were referred to the external appeal committee.
Article 58 — Repealed by Law No. 206 of 2020.
Original text: Appeal committees were constituted by Ministerial decision, each chaired by a non-Authority member chosen by the Minister, with two Authority officer members and two expert accountants from the Accountants’ Syndicate. Committees were permanent; the Minister determined their locations, terms of reference, and members’ remuneration.
Article 59 — Repealed by Law No. 206 of 2020.
Original text: Committee sessions were confidential; decisions by majority with the chair casting the deciding vote on a tie. Decisions were signed within fifteen days and notified to both parties; Tax became due as of notification. Both parties could appeal to the competent court.
Article 60 — Repealed by Law No. 206 of 2020.
Original text: Both the Authority and the Registrant could appeal the committee’s decision before the competent court within sixty days of notification.
Article 61 — Repealed by Law No. 206 of 2020.
Original text: The court could hear disputes between the Authority and the Registrant in camera and ruled expeditiously.
Article 62
The control and arbitration provisions of the Customs Law shall apply to imported taxable goods subject to the supervision of the Customs Authority.
Section Four: Authority Officers
Article 63 (as amended by Law No. 206 of 2020, effective 20 October 2020)
Authority officers may, with written authorisation from the Authority Head or their delegate, inspect workshops, factories, stores, warehouses, establishments, and other places in which activities involving taxable goods or services are carried on. They may seek assistance from security forces when necessary.
Original text: Same as above, with the additional provision that a Ministerial decision, in agreement with the Minister of Justice, determined the functions of officers with judicial police powers in connection with applying this Law.
Article 64 (as amended by Law No. 206 of 2020, effective 20 October 2020)
Authority officers with judicial police powers shall have the right to examine papers, documents, books, records, invoices, and documents of any type connected with applying this Law and to seize them upon finding evidence of violation. They may, with written authorisation from the Authority Head or their delegate, take specified samples from goods for analysis or inspection.
Original text: Same as above, with the additional provisions that: every person was required to assist Authority officers and provide any requested papers, records, or data; officers could not disclose tax secrets or data relating to a Registrant to persons outside the Authority; and exchange of information with foreign tax authorities under Article (8) of the Promulgating Provisions did not constitute disclosure.
Article 65
Except in cases of flagrante delicto, no investigation proceedings may be initiated against Authority officers with judicial police powers in respect of acts committed in, or arising from, the performance of their duties, except upon a written request from the Minister or their delegate. Criminal proceedings may not be brought in any case except after the conclusion of any investigation.
Chapter Five: Offences and Penalties
Article 66 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: A fine of not less than EGP 500 and not more than EGP 5,000, in addition to Tax, Schedule Tax, and Surcharge due, was imposed on procedural violations not constituting tax evasion, including: late filing beyond two years; filing false sales data; free zone surplus or shortage contrary to customs rules; failure to notify the Authority of registration data changes; and obstruction of Authority officers. Penalties doubled on repetition within three years.
Article 67
Without prejudice to the penalties prescribed in this Law or any other law, where a non-resident Registrant fails to fulfil any of the obligations prescribed by this Law, the Minister may request the Public Prosecution to order the prevention or restriction of that person’s access to the Egyptian market until the Registrant fulfils the obligation in question and remedies its consequences. The competent authorities shall execute the order immediately upon its issuance.
Article 67 bis
Without prejudice to the penalties prescribed in this and other laws, where a non-resident Registrant fails to comply with any obligation prescribed in this Law, the Minister may request the Public Prosecutor to prohibit the person from travelling outside Egypt or to prevent the transfer of their assets in the Egyptian market overseas, and the competent authorities shall immediately execute the order upon its issuance.
Article 68 (as amended by Law No. 206 of 2020, effective 20 October 2020)
The following shall constitute evasion of Tax and Schedule Tax punishable under Article (67) of this Law:
(1) Failure to register with the Authority by the prescribed deadlines. (2) Selling a good, providing a service, or importing either without declaring it and paying the Tax and Schedule Tax due. (3) Deducting Tax or Schedule Tax in whole or in part without entitlement, in contravention of applicable deduction limits. (4) Reclaiming Tax or Schedule Tax in whole or in part without entitlement, with knowledge of such. (5) Submitting forged or fabricated documents or records to evade payment of Tax or Schedule Tax in whole or in part. (6) Failure by a Registrant to issue invoices for taxable sales of goods or services. (7) [Repealed] (8) Issuance by a non-Registrant of invoices charged with Tax or Schedule Tax. (9) [Repealed] (10) Fabricating invoices for third parties not arising from actual sales, with joint liability between the fabricator and the beneficiary. (11) [Repealed] (12) Holding taxable goods for trading with knowledge that they are smuggled. (13) Failure to file a final Tax return and pay all Tax due within six months of the date of deregistration. (14) Non-compliance with Article (40) or Article (42) of this Law. (15) Affixing fabricated marks or stamps to evade payment of Schedule Tax in whole or in part. (16) A producer, distributor, or trader selling Schedule goods — where the tax base is the consumer retail price — at a price higher than the price on which Tax was computed, without paying the Tax due on the price differential. (17) Holding Schedule goods for trading without the distinguishing mark (banderol) prescribed by a Ministerial decision. (18) Disposing of or using exempt goods or Schedule Tax-exempt goods outside the exempt purpose during the prohibition period, without notifying the Authority and paying the Tax due. (19) Non-compliance with Article 4 or Article 5 of the Promulgating Provisions.
Article 69
Without prejudice to the penalties prescribed in Article (67) of this Law, goods listed in the Schedule appended to this Law that are the subject of smuggling may be confiscated. If the court does not issue a confiscation order, the Tax that would have been payable on those goods shall be assessed in accordance with the tax rates in force at the time of the evasion. The court may order the confiscation of means of transport and tools used in the smuggling, excluding vessels and aircraft unless specifically constructed or substantially adapted for that purpose.
Article 70 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: In the event of Tax evasion by a legal person, criminal liability attached to the responsible partner, manager, director, delegated director, or board member who actually managed the entity’s affairs.
Article 71
Suspension from professional practice for one year and a fine of not less than EGP 10,000 and not more than EGP 50,000 shall be imposed on every chartered accountant and auditor who violates the obligation prescribed in the last paragraph of Article (30) of this Law. Penalties shall double in the event of repetition.
Article 72 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: No criminal proceedings could be initiated in respect of tax evasion offences and other offences prescribed in this Law except upon a written request from the Minister or their delegate. The Minister could settle such offences prior to a final judgment in exchange for payment of the Tax, Schedule Tax, and Surcharge, plus compensation not exceeding half the maximum fine for procedural violations, or half the Tax or Schedule Tax for evasion offences. Settlement extinguished the criminal action and annulled all its consequences including any sentence pronounced.
Chapter Six: Final Provisions
Article 73 — Repealed by Law No. 206 of 2020, effective 20 October 2020.
Original text: The Minister, following presentation to the Prime Minister, could establish incentive systems for Authority employees in light of their performance rates and the volume and quality of their work.
Article 74
The Minister, with Cabinet approval, may establish an incentives scheme to encourage the use of Tax Invoices. The scheme shall specify the fields, conditions, and rules necessary for its implementation, not to exceed 1% of the Tax collected annually. The Executive Regulations shall determine the rules governing this scheme.
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