Egypt’s FinMin says transit goods are VAT exempt

Egypt has exempted transit goods and related services from value-added tax (VAT) under the second phase of its tax facilitation package, Finance Minister Ahmed Kouchouk said on Monday as the government seeks to expand transit trade.

Kouchouk announced the measure after the Egyptian Customs Authority and the Federation of Egyptian Chambers of Commerce (FEDCOC) signed a guarantee agreement to implement the United Nations-backed Transports Internationaux Routiers (TIR) system, which simplifies cross-border road freight procedures by reducing customs formalities, transport costs and border clearance times.

“There is no VAT on transit goods or the services provided to them under the second package of tax facilitation measures, as part of our efforts to promote transit trade,” Kouchouk said.

He said the Federation of Egyptian Chambers of Commerce remains a key partner in implementing the government’s tax and customs reform programme and facilitating trade.

Kouchouk said the government’s tax and customs reforms are designed to improve Egypt’s competitiveness, facilitate trade and attract investment, describing the TIR guarantee agreement as another step in strengthening cooperation with domestic and international private-sector partners.

“The tax and customs facilitation measures support trade and investment by reducing customs clearance times and costs through further simplification of procedures,” he said.

The finance minister said the ministry is also developing a more advanced customs risk management system to accelerate cargo clearance while maintaining effective oversight.

“We are working on a more sophisticated risk management system that will further speed up customs clearance procedures,” Kouchouk said.

He added that transit trade through Egypt has increased by 40 per cent since March, reflecting the impact of ongoing customs reforms and trade facilitation measures.

The agreement was signed in the presence of Transport Minister Kamel El-Wazir, Investment and Foreign Trade Minister Mohamed Farid, International Road Transport Union (IRU) Secretary General Umberto de Pretto and senior government officials as Egypt continues to align its customs framework with international trade standards and strengthen its role as a regional transport and logistics hub.

Attribution: Amwal Al Ghad English