The Egyptian Tax Authority (ETA) Chair, Rasha Abdel Aal, has confirmed that the recently introduced simplified tax regime, established under Law No. 6 of 2025, is now a permanent legislative measure designed to support the formalization and growth of micro and small enterprises across Egypt.
Speaking on the implementation of the law, Rasha Abdel Aal emphasized that the system is not time-bound or temporary, offering businesses enhanced predictability and stability in their tax planning. The law applies to enterprises with annual revenues not exceeding EGP 20 million, and represents a critical component of the state’s broader efforts to promote entrepreneurship, facilitate ease of doing business, and integrate the informal sector into the formal economy.
“The simplified system provides long-term certainty and reflects the state’s unwavering commitment to a business-friendly, inclusive, and efficient tax environment,” Abdel Aal stated.
Graduated Tax Rates and Comprehensive Incentives
The law introduces a tiered tax structure, starting at 0.4% for enterprises with revenues below EGP 500,000, rising progressively to 1.5% for revenues up to EGP 20 million. Businesses enrolled in the system benefit from a wide range of fiscal incentives, including:
- A five-year exemption from tax audits, starting from the date of registration
- Exemptions from capital gains tax on fixed assets, dividend tax, stamp duty, resource development fees, and notarisation or registration fees on incorporation documents and business land
- Relief from withholding tax and advance income tax payment mechanisms
- Streamlined filing: VAT returns submitted quarterly instead of monthly, and payroll tax returns filed annually
- Simplified compliance requirements, eliminating the need for complex bookkeeping or detailed declarations
These provisions are designed to ease administrative burdens, reduce compliance costs, and incentivize voluntary registration among small-scale operators.
Digital Enablement and Technical Support
Abdel Aal also underscored the ETA’s commitment to supporting digital integration and compliance readiness, noting that the authority is providing:
- Free access to technical and digital services, including the national e-invoicing platform
- Point-of-sale (POS) systems for eligible businesses
- Continuous training and consultancy services to facilitate onboarding and ongoing compliance
Aligning Tax Policy with Economic Development
The simplified regime forms a core part of Egypt’s tax policy modernization agenda, aligning with national strategies for economic diversification, job creation, and SME development. Abdel Aal highlighted that the ETA will continue to implement robust awareness campaigns and provide hands-on guidance to ensure the business community can fully leverage the system’s benefits.
