Representing more than 1000 ICT firms in the country, Egypt’s Chamber of Communications Information Technology (CIT) has submitted a formal request to exclude computer, databases, digital content and internet websites from value-added taxation.
The request was submitted to the Egyptian parliament’s budget and planning committee to exclude computer, databases, digital content and internet websites from value-added taxation.
The CIT said in an official statement on Sunday it was in ongoing meetings with the Egyptian Tax Authority (ETA) to request a VAT exemption and add a new list of tax-exempt items that includes tech and digital products.
The CIT based its request on a number of reasons: first is that most products are already subject to sales tax. If VAT is added, the tax cost of these items will jump from 2 to 5 percent. Moreover, when VAT is added to software and digital products, which have never been subject to sales tax, such industry will suffer a low global competitiveness and discourage new investments. If VAT applied, extra costs from 12 to 17 percent will be added to software industry.