Revised economic plan hikes cigarette, iron, cement, alcohol taxes

Revised economic plan hikes cigarette, iron, cement, alcohol taxes

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Tue, 26/02/2013 - 19:39

Egypt’s amended economic reform plan will raise taxes on cigarettes, alcohol, iron, cement, carbonated drinks and mobile phone use. It also exempts those who make less than LE12,000 monthly from paying income taxes, the government announced Monday.

According to the original economic plan first issued in December, and revoked less than a day after being made public, over 25 goods were to be taxed. People who earned less than LE 9,000 were also exempt from paying income tax.

The amended plan puts less of a burden on the poor, said officials. The new program, like the old, still imposes a 25 percent corporate tax and a 0.001 percent tax on stock market transactions.

Investment Minister Osama Salah told independent newspaper Al-Shorouk that the new program will bring about economic growth and social justice at the same time. He said Egypt’s poor would not pay the price for the country’s embattled economy, since the economic plan is funded by multiple sources, including Islamic Sukuk bonds and savings due to lower energy subsidies as well as consumer taxes.

Officials said they had finished amending the economic reform program and plan to present it to the International Monetary Fund this week, Al-Shorouk reported.
The plan will be implemented over the coming 27 months, instead of 18 months according to the previous program.

President Mohamed Morsy also mentioned some of the measures in a late night pre-recorded televised interview aired early Monday morning. He said pensions for low-income families would be increased to LE400 a month, up from LE100 month, in the new state budget.