Egypt’s cabinet denied reports claiming that the government could impose new taxes on the citizens to face the fiscal deficit, the cabinet said in a statement on Friday.
“The Ministry [of Finance] has not issued any decisions in this regard,” the statement read, saying “Taxes could be imposed only by a legal text following an approval of the House of Representatives.”
“Such claims are rumors aimed at provoking the anger of citizens and damaging the state’s economic stability,” the statement added, without mentioning the sources of the ‘claimed rumors.”
However, the ministry has applied a three-pillar plan to increase its financial resources and the state revenues, mainly joining the unofficial businesses into the state’s sector, increasing the number of tax payers, and fighting the tax-evaders, the statement continued.
Egyptians are in an anticipation for upcoming increase of electricity prices and the final removal of subsidy on fuel prices due to be applied in July.
Since 2016, Egypt has embarked on a bold economic reform program that included the introduction of taxes, such as the value-added tax (VAT), and cutting energy subsidies, with the aim of trimming the budget deficit.
The country floated its currency in November 2016 before it clinched a $12 billion loan from the International Monetary Fund (IMF).
The IMF Executive Board approved in November 2016 a three-year extended fund facility (EFT) loan to Egypt worth $12 billion to support its economic reform program.
Recently, the Egyptian Tax Authority started dealing with the unified tax registration number, and replacing all tax file numbers with the unified tax registration number on June 1, 2019.
The authority clarified that the unified tax registration number is dealt with in all tax assessments, and for all types of taxes, whether income taxes, value added or other.