Egypt Facilitates Tax Free for Tourists to Boost Economy

Reda Abdel-Qader, head of the Tax Authority confirmed on Sunday that Egypt facilitated the "Tax Free" mechanism for tourists to encourage them purchase Egyptian products, in an attempt to boost the economy.

According to the new amendments, tourists can claim a refund of value added tax (VAT) for a period not exceeding three months on purchases of taxable goods, provided that the value of the purchases in one bill is not less than 1500 pounds, and that their purchases exit the country in their company or by any other official means.

Abdel-Qader added that the proposed amendments to the value-added tax law that the Ministry of Finance had made and which had been put up for community dialogue on the Ministry's website include new facilities for registrants.

The head of the authority reviewed some of these amendments, including ones to Article No. (14), which include requiring each registrar to submit a monthly electronic declaration to the authority on value-added tax, during the month following the end of the tax period, explaining that this amendment comes to legalize conditions after the transition to apply the electronic declaration system, not accepting the submission of paper returns, which contributes to the safety of citizens during quarantine.

He added that with regard to the proposed amendment to Article No. (20), it stipulates that the Authority be notified electronically of any changes in the data previously submitted by the registration application, within 14 days of their occurrence, in order to achieve communication between the authority and the registrants electronically.

Also, the proposed amendments to Article (6) and Article (7) of the Value-Added Tax Law include the application of zero taxes on imported goods, used in the free zones, as industrial inputs for future export, except for passenger cars.

Moreover, Services and goods manufactured inside the free zones will be exempted from taxes and will only be treated as imported goods following their consumption or local use outside these zones.

As for the amendments regarding the tax refund, the tax is returned according to the conditions and procedures and within the limits set by the executive regulations within 45 days from the date of submitting the application.

Tax Free refund applies for tourists

Foreign visitors can request a refund of value-added tax (VAT) for a period not exceeding three months on purchases of taxable goods, provided that the value of the purchases on one bill is not less than 1,500 pounds, and that his purchases come from the state in their company or by any other official means.

The tax previously paid or charged to the goods and services that are exported, whether they were issued in their condition or entered in other goods or services, not exceeding the credit balance, provided that the value of exports is not less than the value of their inputs.

Also, the value of the exports should be submitted through one of the banks subject to the supervision of the Central Bank or other official channels.

Finally, these amendments address the shortcomings of the old tax system, which disrupted the system of refunding goods and services subject to schedule tax, as well as exempt goods and services exported abroad, which had no credit balance, in an attempt by the state to facilitate services for tourists and local citizens.