|SEPTEMBER 2020 – EGYPT
TEMPORARY SOLIDARITY CONTRIBUTION
New law approved to introduce a temporary solidarity contribution
The Prime Minister of Egypt proposed a new law which suggests deducting a monetary amount from employees to support the country in dealing with the impacts of pandemics and natural disasters.
The new law, Law No. 170 of 2020, was approved and issued in the official gazette on 13 August 2020. It took effect on 14 August and will be applicable for a period of 12 months.
The law applies to all employees in the private and the public sectors, as well as chairpersons and board members of all public and private entities, whether the relevant employee or person occupies a permanent or temporary position, or acts as an expert, consultant or in any other capacity.
The contribution rates are as follows:
· 1% from the net income of active employees
· 0.5% from the net pension of retired employees
The contribution will be based on both fixed and variable salary elements (including allowances, commissions, incentives, bonuses, overtime payments) after payment of payroll taxes and social insurance contributions.
Active employees with a monthly net income of EGP 2,000 or less and retired employees with a monthly net pension of EGP 2,000 or less are excluded from contributing.
The contributions must be paid into a bank account set up by the Ministry of Finance.
Contact our legislation team at firstname.lastname@example.org if you require any additional information.
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