EGX closes in green notes on June 12    Egypt's President Al-Sisi, Equatorial Guinea's Vice President discuss bilateral cooperation, regional Issues    European automakers shares skid on 'fear of retaliation' from EU tariffs on China EVs    Egypt aims to cut debt service by 30%, lower debt-to-GDP ratio to 80%: Maait    EFG Hermes advises on Saudi Aramco's $11bn secondary offering, EMEA's largest since 2019    Egypt's Higher Education Minister pledges deeper cooperation with BRICS at Kazan Summit    BRICS power emissions hit a record high in Q1    European stocks gain as investors await US inflation, Fed decision    US to widen sanctions on semiconductor sales to Russia    Gaza death toll rises to 37,164, injuries hit 84,832 amid ongoing Israeli attacks    New Development Bank pledges support for Egypt's development goals    Egypt's Water Research, Space Agencies join forces to tackle water challenges    Egypt hosts first New Development Bank international forum in New Administrative Capital    New Zealand excludes farming from carbon pricing plan    Egypt supports development of continental dialogue platform for innovative health sector financing in Africa: Finance Minister    BRICS Skate Cup: Skateboarders from Egypt, 22 nations gather in Russia    Pharaohs Edge Out Burkina Faso in World Cup qualifiers Thriller    Egypt's EDA, Zambia sign collaboration pact    Madinaty Sports Club hosts successful 4th Qadya MMA Championship    Amwal Al Ghad Awards 2024 announces Entrepreneurs of the Year    Egyptian President asks Madbouly to form new government, outlines priorities    Egypt's President assigns Madbouly to form new government    Egypt and Tanzania discuss water cooperation    Grand Egyptian Museum opening: Madbouly reviews final preparations    Madinaty's inaugural Skydiving event boosts sports tourism appeal    Tunisia's President Saied reshuffles cabinet amidst political tension    Instagram Celebrates African Women in 'Made by Africa, Loved by the World' 2024 Campaign    Egypt to build 58 hospitals by '25    Swiss freeze on Russian assets dwindles to $6.36b in '23    Egyptian public, private sectors off on Apr 25 marking Sinai Liberation    Debt swaps could unlock $100b for climate action    Financial literacy becomes extremely important – EGX official    Euro area annual inflation up to 2.9% – Eurostat    BYD، Brazil's Sigma Lithium JV likely    UNESCO celebrates World Arabic Language Day    Motaz Azaiza mural in Manchester tribute to Palestinian journalists    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Increasing tax revenues to EGP 10bn an ‘impossible task': Head of Tax Experts Association
Published in Daily News Egypt on 26 - 05 - 2014

Increasing the tax burden will not result in an increase in revenue, President of the Tax Experts Association Ashraf Abdel Ghani said Sunday, ruling out the finance ministry's ability to increase revenue to EGP 10bn during the coming fiscal year.
"This is an impossible task," Abdel Ghani said. "The imposition of additional taxes does not need to be accompanied by an increase in tax revenues. As the value of taxes imposed increases, the evasion rate will increase as well, especially with the lack of a regulatory system to prevent it."
Abdel Ghani said that the government is betting on increased tax revenues to raise corporate profit taxes to 30%, as opposed to the current 25%. "This, in turn, would negatively affect investment, and on the other hand, will reduce expected tax revenues."
"This is a short-term solution for increasing revenue, but is harmful to the economy in the long-term. It would have been preferable for the government to strive for solutions that do not harm the economy in the long-term," said Abdel Ghani.
Instead, he asserted, the government must, before increasing the burden on the investor, solve disputes within taxation committees and courts, for which arrears amount to EGP 74bn.
Encouraging the parallel economy to join the formal sector, according to Abdel Ghani, represents another "better" solution "as the state did not take any real encouraging measures urging them to join the formal economy" .
He added: "Including the informal economy in the economy system will bring in revenues of approximately EGP 150bn, and in the long-term, it will prove beneficial to the economy."
The finance ministry mentioned in its press release Sunday that it intends to introduce reforms and amendments to the general tax law aimed at broadening the tax base, achieving a just distribution of the burden, and linking proceeds to growth in economic activity, "without mentioning any details related to the process," said Tarek Hammad, a professor of accounting and taxation at Ain Shams University.
Hammad added: "Strong resistance from the informal sector will prevent this objective from being achieved."
An official from the Egyptian Tax Authority said that tax revenues will represent 60% of general revenues with the introduction of value-added tax amendments, which are expected to amass between EGP 6-6.5bn.
The official, who preferred not to be named, said that the value added tax law has not yet been completed and is expected to be implemented during the second quarter of the 2015/2016 fiscal year.
According to the statement, total tax revenues in Egypt account for approximately 14% of GDP, one of the lowest rates in the world.
The amendments related to income taxes also include approval for an additional tax bracket in the income tax structure which will include a 5% tax imposed on natural persons and legal entities whose income exceeds EGP 1m annually.
The official mentioned that this tax will be imposed at the beginning of the fiscal year next July and expected revenues are estimated at EGP 3.5bn.


Clic here to read the story from its source.