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VAT implemented starting Friday: Finance Ministry - Daily News Egypt

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VAT implemented starting Friday: Finance Ministry

A three-month transition period will be applied to allow companies to adapt to the new tax

The Ministry of Finance announced on Saturday that the value-added tax (VAT) was officially implemented starting Friday 9 September.

The law will include a three-month transition period to allow for companies to adapt to the new tax in order to avoid being penalised with fines.

The ministry said they will hold meetings with representatives of the business community and all parties concerned with VAT following the Eid Al-Adha holiday. The meetings will be held to explain the mechanisms of applying the tax and to clarify the actions required of companies.

President Abdel Fattah Al-Sisi assented Act No 67 of 2016 for VAT after its approval by the House of Representatives and its publishing  in the Egyptian Official Gazett eon Thursday.

President Abdel Fattah Al-Sisi approved the VAT draft law following parliament’s approval in late August, according to the Gazette.

According to the VAT law, the Sales Tax Authority will be renamed the Egyptian Tax Authority, and the Ministry of Finance must issue regulations for the transitional period of the law within the next 30 days.

The final version of the VAT approved by parliament witnessed various modifications, including the reduction of its value from 14% to 13%, reducing the amount of expected revenues from the tax. However, next fiscal year the tax will increase to 14%.

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