Egypt

Social security contributions

Employee contributions

The employee contribution percentage is 11% of the total social insurance salary.

The minimum and maximum limits are increased by 15% on 1 January of each year for a period of seven years, starting from 1 January 2021.

Accordingly, as of 1 January 2024, the minimum social insurance salary will be EGP 2,000; whereas, the maximum will be EGP 12,600.

Employer contributions

The employer contribution percentage is 18.75% of the total social insurance salary.

In addition to the above, any managers/board of directors whose names are included in the commercial register of the company will be socially insured as employers and would be subject to social insurance at a flat rate of 21% of the total maximum wage (i.e. EGP 12,600 as of January 2024).

Consumption taxes

Value-added tax (VAT)

The standard VAT rate is 14% (see the Other taxes section in the Corporate tax summary for more information).

Net wealth/worth taxes

There are no net wealth/worth taxes in Egypt.

Inheritance, estate, and gift taxes

There are no inheritance, estate, and gift taxes in Egypt.

Property taxes

The real estate tax law takes into consideration the different variables that can affect the value of a property, such as location, value of similar buildings, and the economic situation of the district in which the property is located. This is to be updated every five years.

Real estate tax is levied annually on all constructed real estate units. This covers land and building, excluding plant and machinery.

Such tax is assessed based on the rental value of the land and building, and these value assessments are set by the committees, after approval of the Minister or whomever the Minister delegates, and published in the Official Journal. Based on the announcement, any taxpayer can appeal the rental value assessment within 60 days following the publication date in the Official Journal.

The real estate tax rate is 10% of the rental value, and the calculation of the rental value differs for residential units and non-residential units. Specific percentages of deductions are provided by the law to account for all the expenses incurred by the taxpayer, including maintenance costs.

The real estate's definition was recently amended to replace the original land spaces’ provision by the following: 'Actually exploited lands, whether independent or attached to buildings, fenced or not (as determined by the relevant executive regulations).'

A new article was recently introduced to the Real Estate Tax Law, allowing, by means of a decision from the Egyptian Cabinet, real estate tax exemption for the real estate actually exploited in the production and services activities stated by the Egyptian Cabinet, provided that the decision includes the below, for each production or service activity:

• The percentage of exemption.
• Its duration.

Luxury and excise taxes

The sales tax law includes an excise tax on some products, such as the tobacco, alcohols, and medicines.

Other non-income taxes

Transfer tax

There is a 2.5% transfer tax on sales of built real estate or land prepared for building, assessed on the total disposal value of the property without any deductions except for villages under certain conditions mentioned in the law.

Stamp tax

There are two distinct types of stamp tax, which are imposed on legal documents, deeds, banking transactions, company formation, insurance premiums, and other transactions, as follows:

• The nominal stamp tax is imposed on documents, regardless of their value. The tax rate for items such as contracts is EGP 1 for each paper (per each copy).
• Percentage or proportionate stamp tax is levied based on the value and nature of transactions.

A proportional stamp tax at the rate of 0.4% annually (i.e. 0.1% per quarter) is imposed on the bank's loan and shared by the bank and the client. This stamp tax is due on a quarterly basis on the beginning balance of each quarter of credit facilities and loans and advances provided by Egyptian banks or branches of foreign banks during the financial year in addition to the amounts utilised within this quarter. 

Loans from other establishments are not subject to this tax.

In addition to the above, stamp duty is imposed on the total proceeds (i.e. value of the transaction) from buying or selling any kind of stocks/securities (with very limited exceptions for the T-bonds and T-bills), regardless of whether they are Egyptian or foreign, listed or non-listed, without deducting any costs, where buyer and seller should each apply the stamp duty on the total proceeds realised.

This type of stamp tax has also been among the changes announced by the Egyptian government, as explained in the Significant developments section of the Corporate tax summary. 

Based on the current law, resident investors trading in or holding Egyptian shares/securities unlisted on the EGX and whether buyers or sellers should be subject to 0.05% stamp tax on the total proceeds realised without deducting any costs (for the transactions involving less than 33%). On the other hand, resident investors trading in listed shares should not be subject to stamp tax (for the transactions involving less than 33%). However, non-resident investors should pay 0.125% on the total value of the transaction for listed and unlisted shares (for transactions involving less than 33%). 

However, for the transactions exceeding 33%, then the stamp tax rate should be 0.3% imposed on each of the buyer and the seller (i.e. the party exceeding the threshold) whether resident or non-resident for listed and unlisted shares.