قانون الضريبة على القيمة المضافة رقم 67 لسنة 2016

المادة 1

In the application of the provisions herein, the following terms and phrases shall have the corresponding meanings hereunder: Minister : Minister of Finance (MOF) Commissioner of ETA : Commissioner of the Egyptian Tax Authority Authority : Egyptian Tax Authority (ETA) Taxable Person : Natural or juridical person, public or private, who is required to collect and pay the tax to ETA whether said person is a taxable commodity or service producer, trader or service provider whose sales reaches the threshold stipulated herein as well as importers, producers or distribution agents of taxable commodity or service regardless of their turnover, as well as producers and importers of commodities and services stipulated in the table attached to the present law regardless of their turnover. Registrant : Taxable person who is registered at ETA in accordance with the provisions of the present law. Associated Person : Any person who is related to another in a way that affects the determination of the tax base including: 1. Spouse, antecedents and descendants; 2. A corporation and the person who directly or indirectly holds at least (50%) of the number or value of shares and/ or voting rights thereof; 3. Partnerships, active partners and silent partners; 4. Any two or more enterprises in each of which another person holds at least (50%) of the number or value of shares and/ or voting rights in each. 5. Employer and affiliated staff who are related to the employer with business relationships. Service Provider : Each natural or judicial person who supplies or provides a taxable service. Importer : Each natural or judicial person who imports taxable sales or services regardless of the purpose of import. Resident : Each natural or judicial person who is settled in Egypt under the provision of the income tax. Permanent Establishment : The premises in which the business operations are carried out, including: 1. Administrative headquarters. 2. Branches, office, factory or workshop. 3. Mine, oil field, gas well, quarries or any other place extracting natural resources. 4. Building sites or construction or installation projects. Such persons who have a permanent establishment in Egypt shall be obligated by the present law. Tax : Value Added Tax Additional Tax : Additional tax of 1.5% of unpaid VAT or Table Tax including due tax resulting from amendments of the tax returns for each or part of the month as of the end of the period specified for payment until the payment date. Input tax : Tax paid by the taxable person upon purchasing or importing goods including machines, equipment and services, whether direct or indirect, related to selling taxable goods or provision of taxable services. Table Tax : A tax imposed at definite rates or values on the sale or importation of local or imported goods and services stipulated in the table attached herein, other than the tax stipulated in the first paragraph of Article (2) herein unless otherwise enumerated in the attached table. Commodity : Every material thing, regardless of nature, source or purpose thereof including electric energy, whether local or imported. The definition of a commodity shall be guided by comments and provisions of the items stipulated in sections and chapters stipulated in the in force Customs Tariff Table. Service : Anything other than any commodity whether local or imported. Exempted Goods and Services : Goods and services included in the exemption lists attached hereto Sale : Transfer of the commodity ownership or service provision from the seller, even importers, to the purchaser. According to the provisions hereto, any of the following shall be deemed sale, whichever precedes: 1. Issuance of an invoice; 2. Delivery of goods or provision of services; and 3. Wholly or partially making payments, down payments, credit sale or any other form of payment for goods and/ or services as per different payment terms and conditions. Tax Invoice : Invoice prepared according to form issued by a decree of the Minister or his authorized representative. Month : Calendar month Tax Period : A period of a month that elapses at the end of each Gregorian month for which registrants submit monthly tax returns. Fiscal year : A twelve-month period starting and ending with the fiscal year of the taxable person. Personal Consumption : Use of a commodity or benefiting from a service for purposes other than business operations. Special Usage : Use of a commodity or benefiting from a service for purposes related to business operations. Transfer of a commodity from one production stage to another inside or outside the facility shall not be deemed a special usage. Non-resident registrant : Natural or legal person who is non- resident in Egypt and shall be deemed liable to register in and charge VAT upon sale of goods and provision of imported services to non-registrant clients in Egypt. Simplified supplier registration system : A system allowing registration of non-resident suppliers in such simplified way as defined by The Executive Regulations Reverse Charge system : A system according to which beneficiary of goods or services shall directly pay tax to ETA instead of non-resident supplier of goods or provider of service in such cases set herein.

المادة 2

Tax shall be charged on goods and services including goods and services listed in the table attached hereto, whether local or imported, in all stages of transactions, unless otherwise specified by a special provision. An amount of 40 piasters of tax collection imposed on serial (First:1/B/3) of Table (1) attached herein shall be allocated to General Authority for Health Insurance and minister of Finance shall define in agreement with Minister of Health such rules governing payment of such amount to General Authority of Health Insurance by virtue of a decree issued by Minister of Finance.

المادة 3

Standard VAT rate on goods and services shall be (13%) for fiscal year 2016/2017, and shall be (14%) as of the beginning of fiscal year 2017/2018, provided that a percentage of (1%) of tax shall be allocated to expenditure on social justice programs. As an exception from the above, tax rate on machines and equipment used in manufacturing a commodity or provision of a service shall be 5% except for buses and passenger cars. Such goods and services exported under the terms and conditions stipulated by the Executive Regulations shall be zero-rated.

المادة 4

Taxable persons shall collect and pay VAT to ETA according to deadlines specified herein.

المادة 5

Upon selling a commodity and/or providing a service by taxable persons in all stages of transactions, tax shall be charged as per the provisions stipulated herein regardless of the method of selling of goods or rendering of services as well as dealing in such including online means. Imported goods shall be taxed, regardless of the purpose of import including personal consumption or special use, in the customs release stage upon the ascertainment of customs duty point. Tax shall also be charged upon Customs release throughout all transaction stages of the goods in Egypt. Rules related to special customs regimes shall be applied on imported goods unless otherwise stipulated by virtue of a special provision herein. Imported services shall be taxed upon rendering such services to service recipients in Egypt regardless of service rendering method. Tax shall not be due on transient goods, provided that such goods are transported under control of Customs Authority in accordance with the rules stipulated in the customs law. Using, benefiting from, disposing of a commodity or a service by taxable persons for personal consumption or special use in any legal manner shall be deemed as a sale.

المادة 6

Goods and services exported abroad by free zones, cities and markets shall be zero-rated. Goods and services supplied to such projects for carrying out related authorized business operations within the free zones, cities and markets except for passenger cars shall be zero-rated.

المادة 7

Without prejudice to the provisions of the second paragraph of Article (6) herein, VAT shall be chargeable on taxable goods or services in accordance with the provisions hereto for local consumption inside the free zones, cities and markets. Importation for the sake of trading within free zone including a whole city shall be deemed as local consumption. Importation made for commercial purposes within free zones that represent an entire city shall be deemed local consumption. Tax is also due on imported taxable commodities or services in accordance with the provisions thereof from free zones, cities and markets to the local market inside the country. Services and commodities manufactured in projects of free zones and cities shall be treated as imported from abroad when withdrawn for local consumption or use. The Executive Regulations shall specify the limitations and rules governing the provisions of this article and Article (6) herein.

المادة 8

In case of suspension and/or liquidation of a business related to a taxable commodity or service, VAT shall be chargeable on commodities in the possession of registrants at the time of disposal unless the successor of the registrant is or shall be registered in accordance with the present law.

المادة 9

Without prejudice to the penalties stipulated herein, smuggled goods sales and sales made contrary to rules stipulated by laws shall be subject to tax rates effective on the date of crime or offense. In case the date is impossible to define, such sales shall be subject to the effective tax rates at the time of seizure or detection of the offense.

المادة 10

1. The value to be declared in the tax return that shall be taken as a basis of VAT assessment for taxable goods sold and services provided, even imported, shall be the amount actually paid or payable in any form of payment in accordance with the natural course of events. 2. In accordance with the provisions of the first paragraph of this article, the value to be declared in the tax return shall include the following: a) Amounts collected from the purchaser or the service recipient under any name as long as such amounts are related to commodity sale or service provision; and b) All incidental expenses, such as the costs of commission, packaging, sorting, transportation, insurance, charged by the seller on the purchaser and/ or importer. 3. Upon sale of a local or imported commodity or service between related persons, the value of sale shall not be less than the price applied between non-related persons as per market forces and transaction conditions. 4. In case of sales by bartering, the commodity value taken as a basis for VAT assessment shall be the sale price according to market forces and transaction conditions. 5. Value to be declared in the tax return for goods and services used for special usage shall be determined based on the total cost. Value of goods and services used for personal consumption shall be determined according to market forces and transaction conditions. 6. The value for installment sales taken as a basis of VAT assessment shall include the installment sale interest that exceeds the credit and discount rate declared by the Central Bank of Egypt (CBE) on the selling date. The Executive Regulations shall specify the rules and procedures of installment sale. 7. According to item (8) of this Article, value of imported goods shall be estimated upon the Customs release based on the value taken as a basis for Customs duty assessment including services relevant to the imported commodity in addition to Customs duty and any other taxes or duties levied, provided that the value to be declared upon sale in the local market shall not be less than value deemed a basis for tax assessment upon Customs release, unless there are commercial reasons justifying such reduced value. The Executive Regulations shall specify the reasons deemed commercial. 8. Tax base for goods and services imported from free zones and cities shall be the total value of the goods inclusive of the value of foreign and local components along with Customs duties and any other taxes or duties collected thereon. 9. The value taken as a basis for Tax assessment on sale of platinum, golden, silver and precious stoned jewelry shall be the value of manufacturing. The tax base for imported jewelry upon customs release shall be the value of manufacturing specified by the Customs Authority in addition to customs duty and other taxes and chargeable duties. Executive Regulations shall specify the stones deemed precious as well as the rules for calculating manufacturing value. 10. The value taken as a basis for tax assessment on sales of goods and services listed in Table attached hereto shall be as follows: First: Sales of local goods and services: The tax base shall be the value actually paid or payable in any form of payment in accordance with the natural course of events, in addition to the Table Tax. Second: Imported goods and services: a) Imported Goods: the tax base shall be the value taken as a basis for Customs duties assessment in addition to the Customs duties and any other levied taxes and duties as well as the Table Tax. b) Imported Services: the tax base shall be the value actually paid or payable in any form of payment in accordance with the natural course of events in addition to Table Tax. 11. The value taken as a basis for tax assessment on new goods purchased by the registrant and re-sold after local use for at least two (2) years shall be 30% of the sale value without applying the provisions of discount stipulated in Article (22) herein upon sale. 12. The Minister of Finance may, in agreement with the Minister concerned, issue price lists of some goods and services, or establish accounting standards for the assessment of Tax.

المادة 11

The value of VAT shall be added to the price of goods or services including officially price-imposed and profit-fixed goods and services. Prices of contracts concluded by two or more taxable parties, or among parties one of whom is a taxable person and which are prevailing at the time of charging VAT and Table Tax, or when amending tax brackets with the same amount or amending the tax burden shall be amended. The Executive Regulations shall specify the rules for applying the second paragraph of this Article.

المادة 14

ETA has the right to assess tax for such tax period in which no tax return was not filed by registrant stating basis on which such assessment was built.

المادة 15

In case ETA amends such tax return after the first three years as of the elapse of the specified filing period, ETA may not charge the additional tax for the period following the elapsed three (3) years and until the registrant is notified of such amendment.

المادة 17

Every non-resident person who is not registered in ETA and sells taxable goods or provides taxable services to a non-registered person inside the country and who does not practice business through a permanent establishment in Egypt, shall apply for registration according to such simplified supplier registration system set forth in the Executive Regulations. Legal persons who are not selling taxable goods or providing taxable services but are liable to assess tax on imported services according to paragraph (2) of article (23) hereof ,shall file an application to ETA for registration for the purposes of reverse charge system. Provisions of this article hall apply to services for six months as of date of enforcement of simplified supplier registration system stipulated for in first paragraph of this article and shall apply to goods for a period of time not exceeding 2 years as of date of enforcement of such system.

المادة 18

The natural or juridical person who does not reach the registration threshold may apply to ETA to register their names and data in accordance with the terms, conditions and procedures specified by the Executive Regulations. Upon registration, such persons shall be deemed registrants governed by this law.

المادة 19

Repealed

المادة 20

Repealed

المادة 21

The Commissioner of ETA may deregister any registrant in some cases in accordance with terms and conditions stipulated in the Executive Regulations.

المادة 22

In accordance with limits, terms and conditions specified by the Executive Regulations, the registrant may, upon calculating the tax, deduct the tax previously paid or charged on their returned sales and inputs as well as goods sold by same registrant out of the tax due on their sales of such goods, at all phases of distribution. The provision of the first paragraph of this article shall apply to the following: 1. Sales of goods and services provided to organizations stipulated in Clause (VIII) and Article (23) of this law. 2. Sales of goods and services funded by grants exempted by law. 3. The deduction shall be within the limit of the due tax. The non-deductible amount shall be carried over to the consequent tax period until the full deduction is made. The above mentioned deduction referred to in the first paragraph of this article does not apply to the following: 1. Table Tax on goods and services, whether taxable as they are or as inputs of taxable goods and services, unless otherwise provided by a special provision herein. 2. Input tax included in the cost. 3. Exempted goods and services. 4. Cases registered under simplified supplier registration system set forth in paragraph (1) of Article 17 hereof.

المادة 23

The following shall be exempted, observing reciprocity principle according to the data of the ministry of foreign affairs: 1. Items bought or imported for personal use for members of foreign non-honorary diplomatic and consular corps who are appointed and incorporated in the lists issued by Ministry of Foreign Affairs, as well as items bought or imported for personal use for spouses and minor children of such personnel. 2. Items bought or imported by non-honorary embassies, commissions, and consulates for official use except for food, spiritual drinks and tobacco. Number of vehicles exempted according to items (1) and (2) shall be defined by one (1) car for personal uses, and five (5) vehicles for embassy or commission official use, and two (2) vehicles for consulates use. Moreover, Minister of Finance in agreement with the Minister of Foreign affairs may increase such numbers. 3. Items imported for personal use, provided such are inspected, including personal effects, furniture, household, appliances and one (1) used vehicle for every foreign employee working for diplomatic and consular missions who do not enjoy exemptions stipulated in item (1) above, provided that such items shall be imported within six (6) months as of the arrival of the said person who shall benefit from this exemption. Besides, the Minister of Finance in agreement with the Minister of Foreign affairs may extend this term of time. The aforementioned exemptions shall be granted ,after approval of exemption request by head of the diplomatic and consular missions, as the case may be, and pursuant to the ratification of the Ministry of Foreign Affairs.

المادة 24

Exempt items as per the provisions of Article (23) herein, are prohibited to be used for purposes other than the purposes specified for exemptions within the five (5) years following the exemption before notifying ETA and paying due tax based on the condition and value of such items as well as the tax rate applicable on payment date, unless otherwise stipulated in respect of reciprocal principle. The Executive Regulations shall define rules and procedures governing same.

المادة 25

Items imported for personal use of some dignitaries may be exempted by virtue of a decree issued by the Minister of Finance and in agreement with the Minister of Foreign Affairs for the sake of international courtesy.

المادة 26

The following items shall be exempted from tax according to the limitations, terms and conditions stipulated in the Executive Regulations: 1. Samples used for analysis purposes by government laboratories. 2. Personal effects and items imported degraded of any commercial use such as decorations, medals as well as sports and academic prizes. 3. Supplies imported from abroad, with no compensation for damage or loss in consignments previously supplied or rejected and for which full tax was collected provided that Customs Authority verifies such instances. 4. Personal luggage of passengers coming from abroad. 5. Items on which tax was previously paid and exported abroad then re-imported as they are, provided that the Customs Authority verifies this.

المادة 27

Some goods may be exempted from tax, by virtue of a decree issued by the Minister of Finance in agreement with the competent Minister in the following two cases: 1. Grants, donations, and presents given to state administrative bodies or local administration units. 2. Imports for academic, educational and cultural purposes by academic, educational and scientific research institutes.

المادة 28

Each and every goods, equipment ,machinery and services relevant to this law and necessary for the purposes of armament for national defense and security as well as material and supplies required for production and parts used in manufacturing thereof.

المادة 29

Without prejudice to the provision of Clause (VIII), other tax exemptions stipulated in other laws or decrees shall not apply to this tax unless this exemption is explicitly stipulated.

المادة 30

VAT shall be refunded, according to the conditions and procedures and within the limits specified by the Executive Regulations, within forty-five (45) days as of the date of submitting the application supported by documents in the following cases: 1. Tax previously paid or charged on exported goods or services whether in same condition or included in other goods or services but not exceeding the credit balance, provided that the value of exports shall be supplied to a bank subject to the supervision of the Central Bank of Egypt (CBE) and according to rules provided by the Central Bank of Egypt (CBE) or according to any of the payment methods or other settlements stipulated by the Executive Regulations, provided that the value of exports shall not be less than the value of their inputs. 2. Tax collected by mistake. 3. Credit balance which lasted for more than six (6) successive tax periods. 4. Tax previously paid on machines and equipment used in the production of a taxable commodity or in providing a taxable service upon filing of the first tax return except for buses or passenger cars, unless the usage of such is the licensed activity of the enterprise. 5. Tax paid by non- resident registrant according to simplified supplier registration system to nationally do business. In all cases, a report signed by an auditor registered in the Accountants and Auditors Table shall be submitted with other documents supporting the right of the taxable person to tax deduction or refund unless tax was proved to be electronically paid to ETA.

المادة 31

Ministries, government entities and agencies, municipal units and public agencies and other public legal persons shall directly remit table tax due to ETA within ten days as of date of tax being payable. Such entities and agencies shall directly remit 20% of VAT due to ETA within same period of time previously referred to as part of total amount of tax withheld thereby. ETA may not request taxable persons to collect amounts previously been remitted and all this shall be set forth in Executive Regulations. Tax on imported goods shall be paid upon release by Customs Authority according to procedures set for payment of customs duties. Such goods may not be finally released before full payment of tax due unless it was proved that non- resident registrant has collected tax on imported goods being released by Customs. Without prejudice to provisions of Article (28bis ) herein, Commissioner or whoever duly delegated by him may, for three months, temporarily release consignments imported for production process or doing business based on guarantees that Customs Authority finds suitable until concerned person submits required documents to Authority to verify qualification to exemption within such stated period of time or payment of tax due and additional tax assessed as of date of consignment release.

المادة 32

In case a non-resident who is not registered in ETA sells a service in Egypt to a registered person, governmental organization, public or economic agency or any other agency where such services are not essential for doing their business operations, the beneficiary of such service shall calculate and pay the due tax to ETA within thirty (30) days as of selling date, unless such non-resident is registered in the streamlined supplier registration system. Legal persons subject to reverse charge system referred to in second item of article ( 17) herein and import services shall assess tax due on such services and pay such tax to ETA within 30 days as of date of supplying such service unless such non-resident non registrant person is registered in the streamlined supplier registration system.

المادة 33

Issuance of invoice by service provider is the tax incidence according to the provisions stipulated herein concerning services of a continuous nature. The Executive Regulations shall define such services.

المادة 34

Repealed

المادة 35

Repealed

المادة 36

Table Tax shall be charged for selling, providing or importing goods and services stipulated in the attached table hereto. Table Tax rate shall be according to percentages and values of goods and services stipulated in the table in addition to the tax stipulated in Article (2) herein. Table Tax shall be charged at zero rate on goods and services that shall be exported in accordance with the terms and conditions specified by the Executive Regulations. Table Tax shall not be recharged unless a change occurs to the commodity status. Packaging, repackaging, refining, purification or grinding is not deemed a change in the commodity status without prejudice to charging the tax on goods and services stipulated in the attached table, unless otherwise stipulated in the table.

المادة 37

The registrant has the right to settle the tax previously paid on parts of machines and equipment as well as spare parts used in manufacturing Table Tax taxable goods and services, against the value of the Table Tax and only within the limit of the due amount of Table Tax until the depletion of same. The registrant has the right to settle the Table Tax previously paid on the sales' returns of same against due Table Tax and in accordance with the terms and conditions stipulated in the Executive Regulations.

المادة 38

The Table Tax on goods and services stipulated in the attached table shall be charged only once at the point of sale of goods or provision of service for the first time or upon the importation of goods or service, without prejudice to charging the tax stipulated in Section II herein. The provision of the first paragraph of this article shall apply to goods and services stipulated in the attached table upon disposal of such in the form of free-of-charge goods and services or promotions. The value of goods and service shall, in this case, be determined as per the market forces and transaction conditions. The Executive Regulations shall define promotions.

المادة 39

The amount to be declared and taken as a basis of Table Tax for goods or services stipulated in the attached table shall be as follows: (A) for local goods and services: The basis shall be the amount actually paid or payable in any form of payment according to the natural course of events. (B) for imported goods and services: The basis shall be the amount taken as a basis for customs duty in addition to the customs duty and any other imposed taxes and duties. Unless otherwise stipulated in the attached table.

المادة 40

In case a commodity or service is taxable according to the Table Tax or the tax rate of such tax is increased, the importers, wholesalers, traders, retailers, and distributors shall submit to ETA a list of inventory of such goods and services on the day preceding the date of applying the new or increased Table Tax. Such inventory list shall be submitted to the ETA within fifteen (15) days as of this date. The new or increased Table Tax shall be charged on the date of submitting the inventory list. The Table Tax on such goods and services shall be paid within the period specified by the Commissioner of ETA, provided that such period does not exceed six (6) months as of due date of such tax.

المادة 41

Each producer, service provider or importer of goods and services stipulated in the attached table herein shall be registered at ETA regardless of the volume of sales or production as per the rules and procedures stipulated by the Executive Regulations.

المادة 42

Any plant or laboratory for producing any commodity or rendering any services stipulated in the table attached herein may only be established or operated after obtaining a license from the administrative body concerned in accordance with the terms and conditions specified by the competent Minister along with the Minister of Finance. Every manufacturer of such goods or provider of such services shall, in case of whole or partial suspension of the operations of business of the plant, laboratory or headquarters through which the activity is carried out for any reason, notify ETA. Also, ETA should be promptly notified upon the discontinuance of suspension period as prescribed by the Commissioner of ETA.

المادة 43

The provisions of the present law shall apply to goods and services enumerated in the attached table herein, unless otherwise prescribed by a special provision in this section and the attached table.

المادة 44

Without prejudice to any special provision prescribed herein, it is prohibited to dispose of any goods exempted from VAT or Table Tax, or to use such goods in purpose other than the purposes for which such goods are exempted within five (5) years following the exemption except after notifying ETA and paying the due tax according to the value of goods and applicable tax rate at the date of disposal. Prohibition stipulated in the first paragraph of this article shall apply to machines and equipment for which tax is previously refunded in accordance with item (4) of article (30) herein. Due tax must not, in all cases, exceed the amount of the tax previously exempted or refunded.

المادة 45

ETA may, when necessary, take samples of some goods to be analyzed and may consult any experts deemed necessary. The person concerned may ask for repeating the analysis on his own expense. The Minister of Finance shall issue decree determining the methods and procedures of taking such samples.

المادة 46

Executive Regulations shall determine the amounts charged by ETA as prices of printed materials, banderole stamps, special marks as well as stamping, analysis expenses and other services provided by ETA officers as well as labor fees for working overtime at times other than the official working hours for the sake of persons concerned. Such amounts are not included under any exemption or refund of VAT or Table Tax stipulated herein.

المادة 47

Without prejudice to the provisions of the Customs Law, ETA may dispose of the seizures and smuggling tools as well as means of transportation confiscated in accordance with the rules specified by the Executive Regulations. ETA may, by a judicial order and before issuance of a ruling, dispose of the seizures subject to damage, decrease or loss and has, after consulting the competent technical authorities, the right to destroy prohibited goods or harmful goods that threaten public health or goods that may jeopardize the security and safety of citizens.

المادة 48

Repealed

المادة 49

Taxable imported goods unreleased from Customs shall be subject to the provisions of violations and evasions set forth in Customs Law.

المادة 50

Taxable person shall pay an amount equivalent to (1%) of amount of tax and table tax due not less than one thousand pounds and does exceed ten thousand pounds in addition to tax,table tax and additional tax due in case of violation of provisions ,procedures,and systems set forth herein and without considering such violation as any such act of evasion stipulated for herein. The following cases shall be deemed violations hereof: 1- A deficit or surplus in goods deposited in free zones and markets in violation of provisions of Customs Law. 2- Failing,on date set to notify ETA of such changes that may be introduced to data listed in the registration application. 3- Violation of provisions ,procedures or systems set forth herein. Amount of fine shall be doubled in case committing such act within three years.

المادة 51

Repealed

المادة 52

Executive Regulations shall define the required control systems over the registrant books and records as well as IT systems and electronic sale machines used by registrants for selling goods, providing services or importing service taxable to VAT or Table Tax in order to verify compliance of registrants to calculate such taxes as per the present law. The Minister or the person so authorized may decide the procedural provisions and rules required to apply the provision of the present law according to the business operations of some registrants.

المادة 53

Repealed