Unified Tax Procedures Law is an Egyptian law aimed at regulating all procedures related to various taxes (such as income tax, value-added tax, stamp duty, and others) within a unified legal framework. Issued under Law No. 206 of 2020, its primary goal is to simplify tax processes, enhance tax compliance, and achieve transparency and efficiency in tax management and collection.
Key Features of the Law
- Unification of Tax Procedures:
- The law aims to integrate and unify the rules governing all types of taxes (income tax, VAT, stamp duty, and property tax) under one framework.
- Eliminates conflicts between previous laws, making it easier for taxpayers to understand their obligations.
- Electronic Filing of Tax Returns:
- Mandatory E-Filing: All taxpayers must submit their tax returns electronically via the Egyptian Tax Authority's portal, whether monthly or annually, depending on the tax type.
- Benefits: Reduces time and effort, improves accuracy, minimizes errors, and provides a user-friendly interface.
- Tax Registration:
- Mandatory Registration: All individuals and entities conducting economic activities must register with the Tax Authority.
- Timeframe: Registration is required upon the commencement of the activity.
- Penalties for Non-Registration: Financial fines are imposed on violators.
- Dispute Resolution Mechanisms:
- Tax Appeal Committees: Specialized committees handle disputes to reduce judicial burdens and expedite resolutions.
- Reconciliation Committees: Allows for amicable settlements of disputes between taxpayers and the Tax Authority.
- Data Confidentiality:
- Ensures the confidentiality of taxpayer data, with exceptions only for legal investigations or judicial orders.
- Digital Transformation and Oversight:
- Introduces advanced technological systems for monitoring and reporting tax operations.
- Mandates the use of electronic invoicing for businesses to enhance transparency.
- Penalties and Sanctions:
- Fines for late filing or payment.
- Severe penalties, including imprisonment, for proven tax evasion.
- Allows voluntary correction of errors without penalties under specific conditions.
- Taxpayer Rights:
- Right to appeal Tax Authority decisions.
- Access to electronic communication with the authority for inquiries.
- Audit and Verification:
- Tax inspections are conducted regularly to verify compliance.
- Audits can also be performed electronically without physical visits.
- Fixed Timelines:
- Specifies clear deadlines for filing returns, audits, dispute resolution, and appeals.
- Electronic Invoicing and Receipts:
- Requires electronic documentation of commercial transactions to combat tax evasion and improve transparency.
- International Cooperation:
- Allows for the exchange of tax information under international agreements to combat cross-border tax evasion.
- Voluntary Compliance:
- Provides incentives for taxpayers who voluntarily comply with filing and payment obligations.
Objectives of the Unified Tax Procedures Law
- Unifying Tax Procedures: Simplify and streamline processes to eliminate complications from previous laws.
- Enhancing Voluntary Compliance: Encourage taxpayers to comply willingly through flexible dispute settlement mechanisms.
- Improving Revenue Collection Efficiency: Ensure timely and cost-effective tax collection to boost national resources.
- Promoting Digital Transformation: Shift to electronic systems for filing, audits, and payments to enhance convenience.
- Ensuring Transparency and Justice: Reduce human intervention and ensure fair tax distribution.
- Combating Tax Evasion: Employ robust digital oversight and international cooperation to curb evasion.
- Supporting Economic Growth: Foster an investment-friendly environment with clear and simple tax procedures.
Targeted Groups
The law applies to all individuals and entities engaged in taxable activities or earning taxable income in Egypt, including:
- Professionals (doctors, engineers, lawyers, etc.).
- Business owners, traders, and self-employed individuals.
- Companies of all sizes, including multinationals.
- Property owners and lessors.
- Importers, exporters, and those in the informal economy.
The law covers all taxes levied in Egypt, including income tax, VAT, stamp duty, and property tax, and applies to all individuals and organizations generating taxable income.
To read the full text of the Unified Tax Procedures Law, click here.