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Egypt's Finance Ministry plans tax on share trading by May- source

Traders work at the Egyptian Stock Exchange in Cairo June 1, 2014.
REUTERS/Mohamed Abd El Ghany

Traders work at the Egyptian Stock Exchange in Cairo June 1, 2014. REUTERS/Mohamed Abd El Ghany

Reuters/Mohamed Abd El Ghany


CAIRO, Feb 23 (Reuters) - Egypt's Finance Ministry is recommending the implementation of a stamp duty on stock exchange transactions of 0.2 percent on both sellers and buyers, a senior ministry official told Reuters on Thursday.

The official said he expects the stamp duty to come into effect before May and generate revenue of 1-1.5 billion Egyptian pounds ($63 million to $94.5 million) in 2017/18.

"We will send the income tax law amendments in early March to parliament, and it will include imposing a stamp tax on bourse transactions of 4 pounds per 1,000, which will be 2 pounds per 1,000 on the seller and 2 pounds per 1,000 on the buyer," the official said.

"We are targeting implementation of that tax before next May," he added.

Egypt imposed a stamp duty on buyers and sellers in May 2013, collecting more than 350 million Egyptian pounds ($18.77 million) in revenue before the levy was replaced in July 2014 by a 10 percent capital gains tax.

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Egypt suspended the capital gains tax in May 2015 for two years, under pressure from investors. They said it was discouraging business just as Egypt was struggling to recover from a plunge in confidence after a 2011 uprising and subsequent political upheavals.

The Higher Investment Council last year extended the suspension of capital gains tax for three years, until 2020 as part of efforts to draw investors back.

More than 270 companies are listed on the Egyptian stock exchange and more than 500,000 investors are registered to trade there.

($1 = 15.8700 Egyptian pounds)

(Reporting by Ehab Farouk; Writing by Asma Alsharif; Editing by Ahmed Aboulenein and Mark Trevelyan) ((asma.alsharif@thomsonreuters.com; +20225783290; Reuters Messaging: asma.alsharif.reuters.com@reuters.net))
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