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Key economic decrees in 2014 - Daily News Egypt

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Key economic decrees in 2014

2014 witnessed several presidential and ministerial decrees that changed economic landscape


2014 witnessed several presidential and ministerial decrees that changed economic landscape. (AFP FILE PHOTO / HO / EGYPTIAN PRESIDENCY)
2014 witnessed several presidential and ministerial decrees that changed economic landscape.
(AFP FILE PHOTO / HO / EGYPTIAN PRESIDENCY)

Special Year End 2014 Feature: 

January

– The then-interim government, headed by former prime minister Hazem El-Beblawi, increased social solidarity pensions by 50%, which will be directed to 1.4 million low-income families, effective January. This increase will cost the state budget EGP 1.2bn, according to state-run news agency MENA.

– The minimum wage law became effective, guaranteeing EGP 1,200 per month to state employees in ministries, government localities and service authorities.

– Egypt’s new constitution, ratified on 18 January, stipulated increasing expenditure on the health sector to 3% of the country’s gross domestic product (GDP). Spending on the education sector and scientific research sectors also increased to 4% and 1% of GDP, respectively, as per the constitution’s articles.

 

February

– The Central Bank of Egypt (CBE) announced its initiative to allocate EGP 10bn ($1.44bn) to finance low-income housing projects, to boost the construction and real estate sectors. The money was said to be sent to banks, in the form of deposits, over a period of 20 years at low interest rates. Low-income citizens who qualify to benefit from the programme will be lent the money at a yearly interest rate of 7%-8%.

– El-Beblawi issued Ministerial Decree 83/2014 forming a committee to study methods for strengthening the social safety net in order to match “the government’s policy to target the neediest category of society”.

April

– Despite the Ministry of Environment’s opposition, the Interim Government approved the industrial use of coal as an alternative energy source. The move came to address the energy shortage, pending the endorsement of the Environmental Impact Assessment.

 

May

– Then-Interim President Adly Mansour issued a presidential decree to amend certain provisions of the 80/2002 Anti-Money Laundering Law. The new amendments criminalise the financing of “terrorist individuals” and “terrorist groups”.

– Mansour issued a decree amending the Investment Law, prohibiting third parties from challenging contracts between the government and investors.

– Mansour issued a decree to allocate around 885,000 acres of state-owned land to the New Urban Communities Authority (NUCA) to establish an urban community in El-Alamein, Matruh Governorate.

 

June

– On 1 June, a presidential decree was issued to grant all state employees 10% of their basic wage each month, effective from July 2014.

– A presidential decree was issued to impose a temporary 5% tax on incomes exceeding EGP 1m annually for a period of three years.

– The government has also imposed taxes on capital gains and monetary dividends earned on the stock market, estimated to proceed to the treasury between EGP 5bn and EGP 6bn.

– Minister of Industry, Foreign Trade and Small and Medium Enterprises Mounir Fakhry Abdel Nour issued a decree to apply 10 standard specifications on imported cars and spare parts. The specifications involve headlights, pneumatic tires, door locks, blinkers, warning sounds, brake linings, speedometers, exhaust purification, and mirrors. The standards had been applied in 2010 to locally assembled cars, but they were never applied to imported cars.

 

July

– President Abdel Fattah Al-Sisi issued a decree to increase a 50% increase on cigarette taxes, a 200% increase on beer and 150% on other alcoholic beverages.

– The government decided to increase the prices of automotive petroleum products, such as gasoline, diesel, and kerosene, in the domestic market, with the aim of trimming the budget deficit by EGP 48bn, which is around 10% of GDP.

– Minister of Electricity Mohamed Shaker announced on 3 July a new pricing strategy for households and commercial sectors, to take effect in July. The new announced tariffs were set to help reduce electricity subsidies to reach EGP 9bn, down from EGP 27.4bn in FY 2013/2014. The rise in prices varies from EGP 0.02 to EGP 0.07 per kW/hour.

August

– Al-Sisi issued Presidential Decree 117/2014 amending the 196/2008 Property Tax Law. The amendment modifies the tax-exempt tranche to include those owning EGP 2m in a single residential unit, while the original law had exempted only those owning an EGP 2m in residential properties in total.

September

– On 1 September, Al-Sisi approved the Suez Canal investment certificate law, to fund the new Suez Canal project. The investment certificates were provided by the National Bank of Egypt, Banque Misr, Banque du Caire, and the Suez Canal Bank.

– The Ministry of Finance made amendments to various provisions of the Stamp Tax Law through the Ministerial Decree 330/2014, which requires industrial companies to pay stamp taxes for natural gas consumptions directly to the relevant tax authorities during the first ten days of the next month, rather than repaying gas companies.

October

– Abdel Nour issued a decree imposing temporary protection fees on imported steel with a percentage of 7.3% for one tonne, which is no less than EGP 290 per tonne, for a period of 200 days.

The minister said that the decision comes in order to protect the steel industry in Egypt from the significant increase in steel imports, adding that the procedures were based on the decision of the advisory committee that considered complaints of local producers.

 

November

– Al-Sisi issued a presidential decree approving a financial loan agreement between the Egyptian government, the European Investment Bank (EIB) and the European Union (EU). The EIB will loan Egypt €77m, while the EU will grant €15m, for a sanitation project in Kafr El-Sheikh governorate in northern Egypt.

– Al-Sisi issued decree 2014/405 on 11 November to organise and ensure the support of the Mortgage Finance Fund specialising in controlling markets and financial non-bank instruments. The articles of the decree organise the rules governing the work of the fund and its objective and terms of reference.

 

December

– Al-Sisi issued a presidential decree Sunday appointing a board of trustees for the ‘Long Live Egypt’ Fund. Members of the new board include former Grand Mufti Ali Gomaa, CBC channel owner Mohamed Al-Amin, business tycoon Naguib Sawiris, head of the financial affairs department in the armed forces General Mohamed Amin Ibrahim Nasr, Reham Abu Ismael, and businessman Basil El-Baz.

Controversial laws

– In August, the State Council requested that the Ministry of Petroleum review the mineral resources law, amend various items, and set an upper limit for the financial categories that will be specified in the by-laws following approval.

– A coalition of non-governmental organisations (NGOs) voiced in September their opposition the application of the value-added tax (VAT).

The coalition said in their statement that, despite the fact that VAT is widely-applied in more than 130 countries, it is one of the taxes that are “prejudiced” against the rights of the citizens, as it is applied on all products and services, with the consumer eventually bearing the effect of the tax.

The government considered replacing the existing General Sales Tax with VAT; a type of consumption tax applied in the European Union that is placed on a product whenever value is added to a stage of production and at a final sale.

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https://dailyfeed.dailynewsegypt.com/2015/01/03/key-economic-decrees-2014/
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