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22-Mar-2017

Egypt extends capital gains tax freeze, approves stamp duty on stocks

Cabinet approved on Tuesday a stamp duty on stock exchange transactions for both buyers and sellers set at 0.125% for the first year of the tax's introduction, rising to 0.150% in the second year and 0.175% in the third. It will also impose a levy of 0.300% for investors buying or selling more than a third of a company's stocks. The Finance Ministry targets raising revenues of EGP1-1.5bn (USD55-82mn, c0.1% of GDP) in the first year of the new stamp duty, Deputy Finance Minister Amr al-Munayer said on Monday. The government also approved the extension of a freeze on a capital gains tax for three years until May 2019. The country originally imposed a 10% tax on capital gains in July 2014, but the following year suspended the tax under pressure from investors for a period of two years. The extension to the capital gains tax freeze and the new stamp duty were introduced in a bill amending Egypt's income tax laws and are subject to approval from the State Council and a vote in parliament before President Sisi can sign it into law on 1 May. 

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