September 14 2022

Egypt: Ministry of Finance Introduces New VAT Exemptions

Source: IBFD Tax Research Platform News

The Egyptian Ministry of Finance (MoF) has introduced new VAT exemptions. Law No. 3 of 2022 amending the VAT Law (Law 67 of 2016) includes the following measures:

  • exempting from VAT input supplies of goods and services to businesses established in special economic zones;
  • defining the VAT treatment of digital transactions, the VAT obligations for non-resident persons conducting e-commerce transactions with Egypt-based clients and the simplification of their registration for VAT purposes; and
  • establishing a VAT refund procedure for goods purchased by non-resident individuals staying in Egypt for a maximum period of 3 months. The minimum amount of purchase per invoice is EGP 1,500. All purchased goods must be exported with the non-resident individuals in order to benefit from the refund.

The amendments to the VAT Law also include an exemption from VAT for the following goods and services:

  • manufactured foodstuffs;
  • water purification, sanitation and desalination services;
  • pharmaceutical products (and their inputs) and input supplies used for the production of paper;
  • vaccines, blood and its derivatives, family planning tools, sewage services (charged to water bills); and
  • international maritime transport services (not including tourist transport).

Law No. 3 of 2022 was published in the MoF official website and can be accessed here (in Arabic only).