On 6 September 2021, the Egyptian Ministry of Finance has issued Decree No. 428 of 2021 clarifying rules and instructions for the tax treatment of capital gains resulting from the disposal of securities, shares, and treasury bills, as well as the stamp tax on dealing in securities.
The Decree aims to Clarifying and simplifying the procedures and tax treatment of the various traded securities to facilitate the taxpayers and lay the foundations of transparency, in a way that contributes to spreading tax awareness.
Starting from 1 January 2022, Natural or Legal Tax residents in Egypt are subject to income tax as a separate pool at a rate of 10% from the disposal of listed securities on the Egyptian Stock Exchange.
The tax treatment of capital gains realized by resident natural or juridical persons from the disposal of quotas and financial securities (listed share):
- 1 July 2014 until16 May 2015: 10% tax rate
- 17 May 2015 until 31 December 2021: suspended
- 1 January 2022 onwards: 10% tax rate
For Non-resident natural or juridical persons from the disposal of quotas and financial securities (listed share):
- 1 July 2014 until 16 May 2015: 10% tax rate
- 17 May 2015 until 30 September 2020: suspended
- 1 October 2020 onwards: exempted
Capital gains realized by resident natural or juridical persons from the disposal of quotas and financial securities (non-listed share):
- 1 July 2014 onwards: 22.5% corporate rate (standard rate)
For Non-resident natural or juridical persons from the disposal of quotas and financial securities (non-listed share):
- 1 July 2014 until 20 August 2015: 10% tax rate
- 21 August 2015 onwards: 22.5% corporate rate
Capital gains realized by resident natural or juridical persons from the disposal of treasury bills:
- 17 May 2020 to 31 December 2021: 22.5% corporate rate
Capital gains realized by non-resident natural or juridical persons from the disposal of treasury bills:
- 17 May 2020 until 30 September 2020: 22.5% corporate rate
- 1 October 2020 until 31 December 2021: exempted
Capital gains realized by resident natural or juridical persons from the disposal of treasury bonds:
- 17 May 2020 until 30 September 2020: waived/suspended
- 1 October 2020 until 31 December 2021: 10% tax rate
Capital gains realized by non-resident natural or juridical persons from the disposal of treasury bonds:
- 17 May 2020 until 30 September 2020: waived/suspended
- 1 October 2020 until 31 December 2021: exempted
Moreover, the Minister of Finance clarifies the stamp tax rates on buying and selling of shares for resident and non-resident legal persons.
