Egypt Country Profile

Tax Administration

Business Corruption

According to the World Economic Forum Global Competitiveness Report 2009-2010, tax regulations and tax rates constitute problematic factors for doing business in Egypt. The number of payments and the time spent on preparing, filing and paying taxes constitute a burden for companies.

Tax administration was mentioned by the Ministry of State for Administrative Development as one of the areas that are particularly tainted with corrupt practices. According to Global Integrity 2008, tax laws are not always enforced uniformly and without discrimination. It is further reported that, while public employees have taxes deducted from their pay, the government will grant preferential treatment to wealthy businesspeople, allowing significant levels of tax evasion to go unpunished. Craftsmen and small business owners often face harassment by tax officials. Tax officials will sometimes arbitrarily determine required tax payments.

Frequency

The World Bank & IFC: Doing Business 2010:
- A medium-sized company must make 29 payments and spend 480 hours per year managing the administrative burden related to paying taxes at a total tax rate of 43% of profits.

The World Bank & IFC: Enterprise Surveys 2008:
- 5.3% of companies expect to give gifts when meeting with tax inspectors, which is a decrease compared to 2007.

- 29% of companies claim that tax administration is a major constraint for doing business.

Transparency International: Bribe Payers Index 2008:
- Business executives give the tax revenue authorities a score of 2.9 on a 5-point scale (1 being 'not at all corrupt' and 5 'extremely corrupt').