VATupdate

VAT rates in Egypt

Quick overview

Standard Rate Reduced Rate Other Rates
14% 5% Zero-rated (0%), special table tax rates and exempt

The local name for VAT in Egypt is Al Dareeba Ala el Qema Al Modafa.

There are basically 2 VAT rates in Egypt:

  • Standard VAT rate is 14%
  • Reduced VAT rate is 5%

The VAT law has two types of tables attached, stating certain goods and services are subject to certain VAT rates, other than the general VAT rate (i.e., special rates). This list is known as “table tax.”

Recent developments

For more information about (recent) rate change developments in Egypt, please click HERE.

Standard rate: 14%

This rate applies for all transactions that take place in Egypt, unless an exception applies (such as a reduced rate, the zero rate or an exemption, or a reason to treat the transaction as outside scope of VAT).

Reduced rate: 5%

Examples of goods and services taxable at 5%

  • Machinery and equipment used in producing taxable or nontaxable goods or rendering services

Table tax

The VAT law has two types of tables attached, stating certain goods and services are subject to certain VAT rates, other than the general VAT rate (i.e., special rates). This list is known as “table tax.”

Examples of goods and services subject to table tax

Special rates apply to a number of goods and services, as follows:

  • Tobacco and tobacco products
  • Petroleum products
  • Vegetable oils – 5% (*)
  • Animal oils and tallow, partially or wholly hydrogenated – 5% (*)
  • Crackers and flour products – 5% (*)
  • Processed potatoes • Fertilizers, agricultural pesticides
  • Gypsum
  • Contracting work, and construction (supply and installation) – 5% (*)
  • Soap industrial detergents for home use
  • Air-conditioned means of transportation, such as buses and trains between the governorates
  • Professional and consultancy services
  • Media and program production – 5% (*)

(*) Rates provided as an illustrative example

Goods and services subject to the table rates and the VAT general rate (14%), with a right to deduct the input tax up to the application of VAT at the general rate:

  • Soda water, 8%+14% (**)
  • Nonalcoholic drinks, 8%+14% (**)
  • Alcoholic drinks
  • Beer (alcoholic and nonalcoholic)
  • Aromatic preparations (skin or hair care), 8%+14% (**)
  • TVs larger than 32 inches, refrigerators larger than 16 feet
  • Air conditioning units and their independent devices
  • Golf carts and similar vehicles, 10%+14% (**)
  • Passenger cars
  • Communications services through cellular phone networks

(**) Rates provided as illustrative example

Zero rate (0%)

Examples of goods and services taxable at 0%

  • Exported goods and services

Examples of exempt supplies of goods and services

The term “exempt” refers to supplies of goods and services that are not liable to VAT and that do not qualify for input tax deduction.

A table lists 57 exempted goods and services (with no right to deduct input tax) including:

  • Tea, sugar and coffee
  • Banking services
  • Medicines and active substances
  • Health care services
  • Production, transfer, sale or distribution of electric current
  • Education, training and research services
  • Sale and rental of land and residential and nonresidential buildings
  • Free services that broadcast through radio and television

Option to tax for exempt supplies. The option to tax exempt supplies is not available in Egypt.

A global VAT/GST rate overview can be found here (note this is a work in progress).

This post was last updated on August 31, 2021.

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