Minister of Finance Dr. Youssef Boutros Ghali told members of US Congress that there has been a notable change  in people’s perception of the tax department to the extent that income from tax  has witnessed a historic increase of 220% while tax returns have soared to a record 2.3 million.  Ghali said there has been serious efforts by the government to simplify regulations to ease red tape in taxes, customs contributing to transparency in the investment climate; steps which have also born fruit among  citizens wishing to commit to tax payment.

Ghali also told US Congress members on a brief visit to Egypt that the tax authority has reduced its brackets to three tiers through which taxpayers commit to pay along the lines of 10%, 15% and 20% taxes, an overall tax cut of 50% for the first time in the history of the tax department.

So far inflation has dropped to 3.7% from 17% after floating the exchange rate.

Asked on steps to accommodate 600,000 unemployed newcomers into the work force, Dr. Ghali replied that at a growth rate of 5%, the market can create employment for a number of youth.  He said growth rate has soared to 6% and the government is undertaking plans to reach 6.9%.  He pointed out to the role of the private sector in absorbing some of the youth into the market.

Ghali told the visiting American delegation that the Ministry of Finance has set up training centers for the newcomers.  The Minister admitted that the unofficial economic activity stands at 40% of Egypt’s market which is lower than the international average rate among developing nations.  He nevertheless hopes the new tax law will attract part of that group, some of which have already caved in to the tax authority.

On trade between Egypt and the US, Ghali noted that Egypt exports 500 million dollars in natural gas to the US and the volume will increase in view of the successful exploration for gas  which is considered a pivotal industry in Egypt in view of the sustained successful explorations all over the country.

On the controversial issue of the US-Egypt free trade agreement, Ghali has delicately noted that the postponement is to be regarded as a delay in privileges while explaining that market prices on European goods are less than tags on their American counterparts. (source ministry of finance)