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Economist, businessman welcome new high-income tax brackets Cabinet approval of two new high-income tax brackets will go towards meeting calls for social justice and shore up state budget, say two well-informed observers
A decision by Egypt's Cabinet to approve two new tax brackets to be applied to high-income individuals will meet longstanding demands for social justice and bolster the state budget, an Egyptian economist and a prominent businessman said Thursday. On Wednesday, Egyptian Finance Minister Momtaz El-Said said that a 22 per cent tax would be levied on individuals with annual incomes between LE1 million and LE10 million, while annual incomes higher than LE10 million would be taxed at a rate of 25 per cent. "No one will reject these new income-tax brackets because this is the only means for the country and government to raise revenue," Egyptian business tycoon Samih Sawiris told Ahram Online. The 25 per cent bracket is not new, as the government approved it in the last fiscal year. It was later given the green light by Egypt's then-ruling Supreme Council of the Armed Forces. Sawiris, however, who was listed as Egypt's seventh richest individual by Forbes magazine last year, added that the other tax bracket of 22 per cent would serve to fill the vast gap between the tax segment of those earning between LE40,000 and LE1 million and those earning LE10 million and up. Meanwhile, Ahmed Ghoneim, an economics professor at Cairo University, said the new tax bracket would not boost national revenue, but would mitigate calls for social justice in Egypt through progressive taxation. Since former president Hosni Mubarak was ousted early last year, successive governments have ignored longstanding calls by leftist groups for a progressive income tax. The new Egyptian personal income tax structure will be as follows: First segment (LE5,000 – LE20,000): 10 per cent Second segment (LE20,000 – LE40,000): 15 per cent Third segment (LE40,000 – LE1 million): 20 per cent Fourth segment (LE1 million – LE10 million): 22 per cent Fifth segment (LE10 million and up): 25 per cent http://english.ahram.org.eg/News/57592.aspx
