On 30 September 2020, the Egyptian Government has published Law No. 199 in the official gazette. The Law contains amendments to the income tax law around capital gains and dividends distribution and certain articles of the stamp tax law with effect from 1 October 2020. The key provisions of the Law are as follows:
Capital gains tax
For residents natural and legal persons, the tax rate is 10% on capital gains resulting from dealing in securities Financial listed on the Egyptian Stock Exchange (EGX) without deducting any costs. However, this tax is postponed till the end of 2021. Also, capital gains realized from the disposal of government bonds shall be exempt.
For non-residents natural and legal persons, the capital gains tax realized from the disposal of listed shares shall be exempt permanently. This will also apply to capital gains realized from selling treasury bills.
Dividends
Withholding tax is imposed for dividend distributions by unlisted companies at a 10% rate, while listed companies are subject to a 5% rate regardless of entity exceeds 25% of the share capital or the voting rights; and the participation is held for at least 2 years.
