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Egypt Tax Reform 2025. In a significant move to improve Egypt’s tax compliance environment, the Egyptian Tax Authority (ETA) has announced the establishment of new specialized tax units designed to ease the burden on businesses and enhance investor confidence.
Rasha Abdel Aal, Head of the ETA, confirmed that these reforms align with broader efforts to make Egypt’s tax system more transparent, efficient, and responsive to business needs.
Egypt Tax Reform 2025: Dedicated Tax Units to Improve Efficiency and Fairness
The ETA has rolled out the following specialized units:
- Investor Support Unit – Focuses on simplifying tax processes and promoting an investor-friendly tax climate.
- Advance Tax Rulings Unit – Provides taxpayers with official, binding interpretations of their tax obligations before any transactions.
- Tax Complaints Unit – Handles grievances efficiently to ensure quick resolutions and better taxpayer satisfaction.
Policy Announcement at National Tax Conference
The announcement was made at the Tax Facilitation Package Conference in Damietta, organized under the auspices of the Future of the Nation Party and supported by the Tax and Customs Committee of the Federation of Egyptian Industries.
Participants included key tax administrators, business leaders, industrialists, and representatives from various chambers of commerce.
Reviewing Progress to Launch a New Phase of Reform
Abdel Aal noted that since 2018, Egypt has undertaken major tax modernization steps. These include:
- Introduction of e-tax returns,
- Implementation of e-invoicing and e-receipts,
- Upgraded tax infrastructure integrated with government systems,
- Unified wage tax calculations.
“Following substantial progress and international recognition, we paused in July 2024 to evaluate our impact and address remaining gaps,” she said.
That evaluation has now spurred a new reform drive under the Tax Facilitation Package.
Simplified Tax System for SMEs in Egypt
A major component of the reform is the introduction of a simplified tax system targeted at businesses earning up to EGP 20 million annually.
According to Ministerial Decree No. 167 of 2025:
- Businesses registering by 12 August 2025 will be exempt from historical tax liabilities.
- Income tax will be calculated as a fixed percentage of turnover, replacing traditional accounting methods.
- The system will apply uniformly across all business sectors.
Scaled Transition for Larger Businesses
Firms exceeding the EGP 20 million mark will move into the general tax regime but will initially benefit from the simplified system. Requirements for enrollment include:
- Filing Form 1/10 via the official ETA website,
- Opting into the simplified regime under Law No. 6 of 2025,
- Submitting simplified returns,
- Complying with e-invoicing, e-receipt systems, and unified wage tax procedures.
Key Incentives for Enrolled Taxpayers
The ETA is offering the following compliance relief and benefits:
- Five-year exemption from tax audits,
- Quarterly VAT filings instead of monthly,
- Annual payroll tax reporting,
- Late payment penalties capped at 100% of the original tax amount.
Egypt Reinforces Its Commitment to Tax Transparency and Growth
Abdel Aal reaffirmed the ETA’s long-term goal of fostering a just, equitable, and supportive tax policy framework.
She emphasized that these reforms not only streamline compliance but also position Egypt as a top destination for foreign and domestic investment by creating a more reliable and transparent tax system.
