The Ministry of Finance announced on Monday that Egypt's overall budget deficit fell to EGP 879.3bn—equivalent to 5.1% of GDP—during the period from July 2024 to February 2025, down from EGP 898bn, or 6.5% of GDP, recorded in the same period a year earlier. According to the Ministry's latest report, the primary surplus grew by around EGP 137bn during this period, reaching EGP 330bn (1.9% of GDP), compared to EGP 193bn (1.4% of GDP) previously. The Ministry attributed this improvement to a notable rise in tax revenues across all categories, supported by a recovery in economic activity, the resolution of the foreign currency shortage, and the positive impact of tax system digitalisation, which enhanced tax administration and broadened the tax base. The report also highlighted tighter control over public spending, aided by improved debt management. Key measures included better distribution of interest payments throughout the fiscal year, diversification of funding sources by reducing reliance on the unified treasury account within legal limits, and capping treasury-funded public investments within the EGP 1trn ceiling set for the current fiscal year. Total public revenues rose by 32.8%—an increase of EGP 356.4bn—reaching EGP 1.442trn, up from EGP 1.086trn a year earlier. Tax revenues accounted for 85.6% of the total, while non-tax revenues made up 14.4%. Meanwhile, public expenditure increased by 15.8%, or EGP 314.9bn, to reach EGP 2.308trn, compared to EGP 1.993trn in the previous year. The Ministry emphasized that the rise in spending reflects the government's commitment to fiscal discipline, prioritizing human development and citizen services. Tax revenues alone rose by 38.4%, or EGP 342.4bn, reaching EGP 1.234trn, compared to EGP 892bn during the same eight-month period a year earlier. The Ministry noted that the increase spanned all types of taxes, driven by economic recovery, the easing of the foreign exchange crisis, and ongoing digital reforms in tax administration. Collections from sovereign entities grew by 39%, or EGP 78bn, to reach EGP 278.4bn, while tax collections from non-sovereign entities rose by 38%, or EGP 264bn, reaching EGP 956bn. Income tax collections rose by 21.3%, or EGP 63.2bn, totaling EGP 359.6bn over the eight months. This included a EGP 27bn increase in income tax from local salaries (to EGP 110bn), a EGP 7.7bn rise from commercial and industrial activities (to EGP 46.7bn), and a 36.8% increase in taxes from non-commercial professions (to EGP 7.9bn). Corporate tax collections stood at EGP 189.8bn. Value-added tax (VAT) collections rose by 39%, or EGP 160.8bn, reaching EGP 573bn. VAT on goods increased by 54.3% to EGP 327.6bn, while VAT on services rose by 34.8% to EGP 47.6bn. Property tax revenues surged by 59.3%, or EGP 78.9bn, reaching EGP 212bn. Customs duties also saw strong growth, rising by 74.2%, or EGP 33.7bn, to reach EGP 79.2bn. Non-tax revenues increased to EGP 208bn during the same period.
