EGYPT Law and Practice Contributed by: Mohamed Hashish, Heba El Abd, Mariam Rabie, Mohamed Selim and Abdelaziz Mohamed, Soliman, Hashish & Partners
• paying tax in the manner and within the time limit specified; and • including the unified tax registration number in all correspondence and dealings with the ETA or third parties. Further, legal persons who sell a commodity or provide a service shall register all their purchases and sales of goods and services on the electronic system, in a manner that ensures that the ETA can track the move - ment of transactions permanently, and determine the size, value, parties involved, and other matters neces - sary for assessing and collecting the prescribed tax. 5.8 Tariffs Customs and tariffs in Egypt are governed by Law No 207 of 2020 (the “Customs Law”) and Decree No. 218 of 2022 issued by the President of Egypt and amended by Presidential Decree No 67 of 2023 (the “Customs Tariff Decree”). Under the Customs Law, a customs tariff is defined as a table formulated based on the description and classification of goods. It sets forth the application rates of customs duty levied on such goods, in addition to the general interpreta - tive rules governing the application of these duties. Simultaneously, the Customs Tariff Decree sets out the rules, categories, and schedules of the customs tariff, as well as any amendments or cancellations. According to the Customs Tariff Decree, goods tem - porarily exported for repair are taxed upon re-import at 10% of the total repair cost, including transport and insurance. Additionally, goods exported for comple - tion of manufacture are taxed upon re-import at the rate applicable to the final product, calculated on the cost of the finishing work plus transport and insur - ance. With regard to the tourism sector, hotel and tourism establishments may import equipment and machinery (excluding private passenger cars) at a reduced 20% customs duty or the applicable import tax, whichever is lower, under conditions defined by the Minister of Finance. According to the Customs Tariff Decree, the following goods benefit from reduced customs duty rates:
• infant formula manufacturers: 2% of the value or the applicable import tax, whichever is lower, on raw materials and inputs; • Arab Petroleum Pipelines Company: 2% of the value or the applicable import tax, whichever is lower, on imports for projects, including machinery and transport (excluding passenger cars); • Arab Organization for Industrialization compa - nies: 5% of the value or the applicable import tax, whichever is lower, on components for overhauling locomotive turbine engines; • electric/clean energy vehicle infrastructure: 2% of the value or the applicable import tax, whichever is lower, on: (a) EV or natural gas refuelling station equipment; (b) EV/gas conversion kits; (c) environmental monitoring equipment; and (d) renewable energy components (wind/solar); • electric bus manufacturers: 2% of the value or the applicable import tax, whichever is lower, on batteries, electric motors, control units, auxiliary system units, steering units, battery cooling units, and air conditioning devices; • mobile phone manufacturers: 2% of the value or the applicable import tax, whichever is lower on batteries, speakers, and cameras; and • natural gas vehicles: 35% reduction on the appli - cable import tariff. Incentives for Local Assembly Industries The Customs Tariff Decree sets out the conditions under which assembly industries may obtain permis - sion to have their assembled products treated under customs supervision, with preferential treatment for customs duties. In this regard, completely disassem - bled parts imported for industrial assembly under the supervision of the Customs Authority may benefit from a reduced import duty. Specifically, it shall be subject to the customs duty applicable to the complete prod - uct, reduced by 10%. Furthermore, where the local manufacturing compo - nent of the product reaches at least 10%, the import - ed foreign components may be subject to a reduced customs duty – lower than that applicable to fully finished product – based on a graduated scale. This reduction may reach up to 90%, or alternatively, the product may be subject to its individual component
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