A government source said that the Automotive Development Strategy Directives bill that is now being discussed in parliament will not impact the Egyptian-European partnership agreement, which is expected to make all imports of European cars customs-exempted by 2019.
The source added that the text of the draft law imposes an additional tax on imported cars as an internal affair that targets local industry and does not violate the agreement, especially as the agreement is applicable on customs but not taxes.
He pointed out that the government is working on the harmonisation between importers and manufacturers. “Importers aim to return the highest profitability, while local manufacturers face many challenges,” he said. “This makes importers keen on reducing customs on higher categories, which sometimes see customs of 135%.”
The source noted that the bill is still under study to ensure it will have the least negative impact but would still protect local manufacturers.
He added that the government has not received any formal objections from the European Union until now regarding the draft law.