Sisi Tackles Draft Budget for Fiscal Year 2022-2023

President Abdel Fattah El Sisi was convened with Prime Minister Dr. Moustafa Madbouly, Minister of Finance Dr. Mohamed Maait on Sunday to discuss the draft budget for the fiscal year 2022-2023.

The Minister of Social Solidarity Mrs. Nevin El-Kabbaj, Head of the National Authority for Social Insurance Mr. Gamal Awad, Vice Minister of Finance for Fiscal Policies Mr. Ahmed Kouchouk and Deputy Minister of Finance for Public Treasury Dr. Ihab Abu Aish, attended the meeting.

Sisi directed the government to immediately prepare financial and social protection measures to mitigate the effects of global economic repercussions on Egyptian citizens.

The minister of finance presented the main final indicators of the draft budget for the fiscal year 2022-2023, which will see the following; reducing the total budget deficit to about 6.3% of GDP, continuing to achieve an initial surplus of 1.5% of GDP, and reducing the ratio of public budget agencies’ debt to GDP to about 80.5%.

This is also in addition to raising the revenue growth rate to about 17%, in order to approximately reach 1.447 trillion EGP and increase expenditures at a growth rate of 16% to reach about 2.7 trillion EGP, including the allocation of 365 billion EGP for investment, 400 billion EGP for wages, and 323 billion EGP for the subsidy system.

The president was also briefed on the developments of the tax system, namely the electronic invoice system, the mechanization and development of tax procedures, and the status of various measures to combat tax evasion, whether through tax campaigns or through the new electronic tax unit, which has counted 5,000 cases in the past period and will complete their registration procedures.

The growth rates in electronic tax returns were also presented. The number of registrants increased by 106% from June 2018, in addition to the increase in the number of filers during the same period by more than 60%.

This is in addition to presenting the status of the value-added tax proceeds, which increased by 22% compared to last year, as well as the efforts of the smart reporting and case management system at the Tax Authority, which examined more than 41,000 cases during the last period and paid for nearly 5,000 cases of tax evasion, with amounts totaling up to 5.5 billion EGP.

Sisi was also briefed on amendments to the draft income tax law, particularly reforms related to revitalizing the Egyptian Stock Exchange, in line with agreements with investors and the Stock Exchange to support and encourage investment, as well as exempting investment funds and vessels that invest in the Stock Exchange from tax and replacing it with a flat tax on returns.

This aims to encourage institutional investment, support startups, avoid double taxation and achieve tax justice.

This is also in addition to renewing the use of the law to end disputes so as to speed up their completion and reduce the burden on the Tax Authority, in light of work for its automation and development, also providing an incentive for people to request electronic invoices and receipts.

This simultaneously obligates the business community to rely on electronic invoices as of 2023. In addition, the inclusion of simplified tax treatments in income tax law will benefit all companies without obligating them to register with the Micro, Small and Medium Enterprise Development Agency (MSMEDA) and regulating the role of the Supreme Tax Council in order to guarantee the rights of taxpayers of all kinds and assist them fulfill their legal obligations.

The president was informed on the axes of the strategy for developing the customs system as well as the most important programs and initiatives taken in this regard. This includes activating the system of obligating imported goods to conform to international standards, during the current month.

This is also in addition to being briefed on the status of the application of the pre-registration system for shipments, which saw the registration of nearly 30,000 companies to date and rejecting over 2,000 requests for violating import regulations, procedures, and laws.