New Tax Facilities According to Law No. 7 of 2025

As part of the Egyptian government's efforts to modernize and develop the tax system, Law No. 7 of 2025 was issued, amending certain provisions of the Unified Tax Procedures Law issued by Law No. 206 of 2020. These amendments aim to enhance transparency, reduce burdens on taxpayers, and protect state rights.

Key Amendments in the Law

1. Modification of Late Payment Interest and Additional Tax Limits

Article 45 (bis) has been added, stipulating that the late payment interest or additional tax shall not exceed 100% of the original tax due. This amendment responds to numerous complaints regarding excessive late payment interest, which imposes significant financial burdens on businesses and taxpayers.

2. New Tax Settlement Facilities

Article 75 (bis) has been introduced, outlining mechanisms for settling tax offenses, whether before or after the initiation of criminal proceedings. The new amendments specify the compensation rates required to complete the settlement, helping to reduce tax-related legal disputes.

3. Regulation of Non-Deduction or Non-Withholding Cases

Article 75 (bis) 1 has been added to address cases of failing to deduct or withhold due amounts or failing to remit them to the tax authority within legal deadlines. The article also sets compensation rates for such cases, ensuring compliance by businesses and individuals in timely remittance of due taxes.

4. Enhancement of Tax Audit Mechanisms

The new law allows for simplified audit procedures for small and medium-sized enterprises (SMEs), facilitating tax compliance for these entities and encouraging them to operate within the formal economy.

5. Expansion of Electronic Payment Scope

The law emphasizes the expansion of electronic payment methods as a mandatory means for tax payments, aiming to reduce cash transactions and enhance transparency in tax collection.

Significance of These Amendments

The new amendments aim to:

• Improve the business environment and reduce tax disputes.
• Encourage voluntary tax compliance among businesses and individuals.
• Enhance tax collection efficiency and minimize the tax gap.
• Promote the use of technology in tax operations.

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Conclusion

Law No. 7 of 2025 marks a significant step towards the development of the Egyptian tax system. Through these amendments, the government seeks to strike a balance between effective tax collection and protecting taxpayer rights. Therefore, compliance with these laws and staying informed about their updates is essential for ensuring the smooth and legal operation of businesses.

For more details, you can view the full text of the law here.