INCOME TAX RATES, 2018
Law No. 97 of 2018, amending Income Tax Law No. 91 of 2005, was approved on 23 June 2018 by Egypt’s President Abdel Fattah al-Sisi.
The amendment to the income tax rates on the income of natural persons has been amended to reduce the tax burden on low-income taxpayers.
The updated annual tax brackets, effective 01 July 2018, are as follows:
In addition, the following measures will apply:
- Taxpayers in the second bracket: applying a discount of 85% if this is the highest income bracket, meaning those in the income tax bracket making between 8,000 – 30,000 pounds a year and who would normally pay a 10 percent income tax will get an 85 percent tax break, meaning they pay 15 percent of taxes they would normally pay.
- The 30,000 – 45,000 pound bracket: applying a 45 percent tax break, meaning they pay 55 percent of the taxes they would normally pay.
- The 45,000 – 200,000 pound a year bracket: applying a 7,5 percent tax break, meaning they pay 92,5 percent of the taxes they would normally pay.
- Egyptians making more than 200,000 pounds a year who get taxed at 22.5 percent will pay their full income tax.
It is important to note that the new tax update would be considered starting July 2018 until December 2018, accordingly tax year end, and should be divided to cover the first half (January to June) using old tax brackets and the second half (July to December) using the updated tax brackets and the related discounts.
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