Egypt – New 5-Percent Tax Rise on High Earners Introduced

Egypt – New 5-Percent Tax Rise on High Earners In...

Egypt is imposing a 5% tax increase (from 25% to 30%) for individuals earning over EGP 1,000,000 annually, effective from tax year 2014 for a 3-year period.

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Flash Alert 2014-072

Recently, Egypt's government approved a temporary 5-percent tax on wealthy individuals intended to help fund the country’s social programs, but more immediately to help address the country’s deficit problem.1


This tax rise potentially affects high-income earning employees on assignment in Egypt and those Egyptian assignees overseas who are subject to taxation in Egypt.  This could raise the costs related to such assignees and impact tax equalizations.

In addition, if budgeting for assignments to/from Egypt, when considering employees for such assignments that are high-income earners, budget projections may need to take into account this new temporary tax increase.

The tax increase from 25 percent to 30 percent is effective from tax year 2014 for a 3-year period and applies to those earning over one million Egyptian pounds (app. $142,200) a year.

Law 44 for 2014 amending Income Tax Law 91 for 2005, which was published in the Official Gazette (Al Gareedah Al Rasmeyah) on 4 June 2014, ushered in this tax increase.

Until this change, individuals earning above EGP 250,000 a year were taxed at a rate of 25 percent. Now that rate is capped at EGP 1,000,000 and those earning over EGP 1,000,000 are taxed at a 30-percent rate.

The table below illustrates the new tax schedule.

Annual taxable income
Rate (%)
up to 5,000 0
5,001 30,000 10
30,001 45,000 15
45,001 250,000 20
250,001 1,000,000 25
over 1,000,000 30

[EGP 1 = EUR 0.1043 | EGP 1 = USD 0.14 | EGP 1 = GBP 0.0826]

The information contained in this newsletter was submitted by the KPMG International member firm in Egypt.

© 2016 KPMG Hazem Hassan Public Accountants & Consultants, an Egyptian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Flash Alert is an Global Mobility Services publication of KPMG LLPs Washington National Tax practice. The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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