Egypt imposes 10 pct tax on capital gains, dividends

Cairo – ArabTelegraph – Egypt’s president approved a law on Tuesday imposing a new 10 percent tax on capital gains and stock dividends, as the country seeks to revive an economy battered by more than three years of political turmoil.

The tax applies to dividends and capital gains made from trading stocks on the Egyptian stock market as well as unlisted companies.

“(This) comes in response to the major challenges which the Egyptian economy has faced which demand coordination of all efforts to protect and rebuild confidence in it,” a statement from the presidency said.

Egypt, which has relied heavily on aid from Gulf Arab allies in the past year, needs to implement broad economic reforms in order to revive its economy, which saw a drop in foreign investment and tourism after the 2011 uprising.

The government is trying to boost state revenues without discouraging investment.

The tax on stock market gains, which authorities announced in May, was watered down last month after the bourse recorded its biggest daily drop in almost a year.

Finance Minister Hany Dimian has estimated that the tax would raise between 3.5 and 4.5 million Egyptian pounds