Finance Minister Hany Kadry Dimian has commenced a dialogue on a new law pertaining to customs and taxation, to replace an incumbent bill that has been in place since 1963.
The move is the latest in a series of measures taken by the country to revamp laws with the aim of developing the economy.
According to a statement issued by the Ministry of Finance, Dimian said the current law clashes with articles of the Kyoto Protocol, which aimed to facilitate customs procedures. It further clashes with the Convention for Facilitating Trade Exchange and the Regulation of Transit between states of the Arab League.
The finance minister added that the current law no longer matches the era of technology, which saves both time and efforts. The dated bill also fails to impose deterrent penalties against violators, which has, in return, increased evaders.
An important feature in the new bill, according to Dimian, is the unprecedented offers to the commercial and industrial communities, such as enabling them to postpone and pay in instalments their customs obligations on machinery, equipment and production lines for agricultural, or industrial production The law also emphasis anti-smuggling actions to protect national industries.
Commenting on this aspect, Chairman of the Chamber of Textile Industries of the Federation of Industries Mohamed El-Morshidi said the law restores the penalty of imprisonment for evaders, a punishment that was previously available but was reduced to a mere fine. “This massively encouraged violations,” he said.
El-Morshidi added the amendments have been completed and are awaiting approval from the Cabinet before it comes into action. “As a whole, the changes are quite satisfactory, and we just hope for a speedy implementation of them,” he said.
Commending the amendments, El-Morshidi added that while it provides mechanisms easing payments of customs on businesses, whether commercial or industrial, it also emphasises on restrictions and guarantees.
Dimian is also looking into multiplying returns from taxation as Egypt gears to shift from tax on sales to value-added taxes, or VAT.
During a meeting with 250 district managers at the Egyptian Tax Authority, as part of an ongoing dialogue about the anticipated bill, Dimian discussed flaws in the current bill, as well as the possibility of raising tax returns by three or four times, given that the Egyptian economy is capable of generating tax incomes much higher than the amounts currently being achieved, a statement from the ministry said.
Source: Daily News Egypt
