In an open discussion with the heads of investor associations from across Egypt’s governorates, Egypt’s Minister of Finance, Ahmed Kouchouk, emphasized the vital role of the Small and Medium Enterprises Association as a key partner in the successful application of the new tax facilitation package. The dialogue aimed at advancing Egypt’s economic growth through targeted support for small businesses, entrepreneurs, and startups. This collaboration signals a concerted effort to create an environment conducive to growth, innovation, and economic expansion.
SMEs at the Forefront of Egypt’s Economic Strategy
The session brought together Sherif El-Kilani, Deputy Minister for Tax Policies, Yasser Sobhi, Deputy Minister for Financial Policies, and Rasha Abdel-Aal, Head of the Egyptian Tax Authority. During the session, Kouchouk shared insights into the government’s unwavering commitment to creating a favorable business environment for small businesses. Kouchouk emphasized that these businesses are central to the Egyptian economy’s future, with a specific focus on incentivizing their growth through robust tax reforms.
A New Tax System for Small Businesses
The newly introduced simplified and integrated tax system offers an unprecedented opportunity for businesses with annual revenues not exceeding EGP 20 million. Under this new framework, 9 tax exemptions have been introduced, designed to reduce the burden on small businesses, facilitating their easier entry into the formal economy and ensuring they can access necessary support to thrive.
“The SME Federation is an integral partner in successfully implementing the first phase of these tax reforms. Together, we are working to extend these exceptional tax incentives to every individual and business in Egypt,” Minister Kouchouk stated.
This new system marks a significant departure from past practices, eliminating obstacles that hindered small business registration and offering tax authorities’ support to entrepreneurs who were previously unable to formalize their businesses.
Expanding the Tax Base with Trust and Partnership
In his address, Kouchouk outlined the broader goal of expanding the tax base, focusing on building trust and encouraging voluntary compliance among taxpayers. The aim is to foster a “trust and partnership” approach that will lead to a wider and more inclusive tax base. This approach is not just about revenue generation, but about creating a sustainable ecosystem where businesses feel supported and motivated to contribute to the national economy.
The Ministry also highlighted ongoing efforts to ensure that businesses registered under the new simplified tax system would benefit from additional incentives. These will include financial support and export opportunities, designed to further empower these businesses, particularly the first 50,000 taxpayers who will register under this system for the first time.
Forward-Looking Plans for Financial Support and Additional Incentives
Kouchouk confirmed that the government is currently exploring additional financial incentives and funding support for the first 50,000 taxpayers to register under the new tax system. This initiative aims to attract new businesses into the tax fold and provide a nurturing environment for those businesses to expand and thrive.
Additionally, businesses that have registered for the new system will be eligible for other state-driven benefits, including access to funding opportunities and export incentives. These measures will help ensure that Egypt’s small businesses are not only protected but are also able to grow and expand into new markets.
A Unified Approach to Empower Small Business Growth
Alaa El-Sokti, Chairman of the Small and Medium Enterprises Federation, emphasized the importance of directly engaging with small business owners to ensure they are fully aware of and able to access the new tax benefits. He reiterated the Federation’s commitment to maintaining close communication with SMEs to ensure they benefit from the full range of tax incentives available.
El-Sokti praised Minister Kouchouk’s new approach to tax policy, noting that it represents a significant shift in thinking and plays a critical role in stimulating Egypt’s economic activity and investment climate. “With this innovative vision, the Ministry of Finance is driving an important shift that will facilitate small business growth and investment across the country,” El-Sokti added.
Conclusion: A Vision for Sustainable Economic Growth
The tax facilitation package represents a critical milestone in Egypt’s ongoing efforts to support small and medium-sized enterprises, stimulate entrepreneurship, and drive economic growth. The combined efforts of the Ministry of Finance, the Small and Medium Enterprises Association , and other stakeholders will ensure that the benefits of these reforms reach those who need them most—small businesses, entrepreneurs, and startups.
