Minister of Finance Ahmed Kouchouk confirmed that Egypt’s real estate transaction tax will remain at 2.5%, while highlighting benefits from the recently launched second tax facilitation package for developers. Speaking with real estate stakeholders, Kouchouk emphasized the government’s priority to simplify tax procedures, expand the tax base, and encourage voluntary compliance through digital solutions.
A dedicated mobile application will allow users to pay the 2.5% tax per unit digitally, regardless of the number of transactions, without administrative burdens. While no launch date has been announced, Kouchouk also revealed plans to form a high-level committee to review challenges in real estate development and provide solutions.
The second tax facilitation package aims to create a growth-friendly investment environment. Key measures include preventing double taxation by exempting dividends for Egyptian firms affiliated with local holding companies, deducting returns on foreign loans for strategic private sector projects, and reducing VAT on medical devices from 14% to 5%. In addition, a stamp tax will replace the capital gains tax on trading profits for three years, encouraging investments and listings on the Egyptian Stock Exchange.
Property tax relief is also being enhanced, with waivers on taxes and late payment fees during crises and an exemption limit for private housing raised to EGP 4 million. Late payment penalties will not exceed the original tax amount, and payments will be processed digitally.
The facilitation packages were recommended by the IMF as part of expanding Egypt’s tax base without raising rates on existing taxpayers, following the IMF’s fourth review of its $8 billion Extended Fund Facility program. Egypt has adjusted its fiscal targets, with the IMF projecting the financing gap for FY2025/2026 to rise from $5.2 billion to $8.2 billion and almost doubling to $6.1 billion in FY2026/2027.
Additional incentives include the White List and Excellence Card programs for compliant taxpayers, faster VAT refunds, streamlined inspections and approvals, and options to offset tax credits and debits to ease payments. These measures aim to improve liquidity and build trust with businesses.
Egypt’s tax revenues have surged in FY2025/2026, with income tax revenue up 45.6% to EGP 205.5 billion and property tax revenue increasing 32.3% to EGP 157.3 billion between July and October. Kouchouk reaffirmed the ministry’s openness to new ideas from businesses to further unify and automate tax procedures and stimulate real estate exports.
The government is integrating AI into the Egyptian Tax Authority’s operations to modernize administration, strengthen institutional capacity, and improve services through data-driven decision-making. These initiatives, alongside digitalization and customs modernization, are expected to continue driving significant growth in Egypt’s tax revenues throughout FY2025/2026.
