Egypt is considering exempting fund investors from tax on profits

The Egyptian government is considering exempting holders of investment fund documents of all types from tax on profits, with the aim of stimulating the participation of individuals and institutions in the market, according to a government official told Al-Sharq. Investment funds in Egypt are currently subject to a tax on dividends at a rate of 5% for policyholders who are natural individuals and 15% for institutions and companies. Anticipated law amendment Tax exemption for investors in funds will be part of an expected law amendment early next year, according to the government official who requested anonymity, adding that it will include all types of funds such as direct investment funds, real estate funds and gold funds. Last June, the Egyptian Council of Ministers announced the government’s intention to reintroduce the “stamp tax” on stock market transactions instead of the capital gains tax for both residents and non-residents. Finance Minister Ahmed Kouchouk told Al-Sharq earlier this month that the proposed amendments will be presented to the Legislative Council next January. The Egyptian government is relying on investment funds, which also include investment funds in stocks, fixed income instruments, gold and real estate, to attract more investment flows, especially after interest rates were cut by a cumulative rate of 525 basis points since the beginning of this year.