Middle East

Egypt to take 1 percent from salaries due to coronavirus

FILE PHOTO: Cars drive past the blank billboards on the 6th of October Bridge, amid concerns over the coronavirus disease (COVID-19) in Cairo, Egypt May 13, 2020. REUTERS/Amr Abdallah Dalsh/File Photo

CAIRO: Egypt will deduct 1 percent from people's salaries for 12 months beginning on July 1 to offset the economic repercussions of the coronavirus, according to a draft law approved by the cabinet Wednesday.

The tax will be imposed across all sectors of the economy in both the public and private sectors for net monthly salaries exceeding 2,000 Egyptian pounds ($127), the cabinet said in a statement. A tax of 0.5 percent will be deducted from state pensions.

The measure comes as Egypt tries to deal with the economic impact of the pandemic, which has brought tourism to a standstill, triggered major capital flight, and threatened remittances from Egyptians working overseas.

Revenues from the salary tax will be used to support organizations and workers hit by the fallout from the virus, as well as for direct support to some citizens and funding for the medical sector, the cabinet said.

Those affected economically by the outbreak may be exempted from the tax.

Egypt has confirmed more than 13,400 coronavirus cases, including more than 650 deaths, and Tuesday saw its biggest rise in daily cases to date.

The government has received nearly $2.8 bln in emergency financial support from the IMF to help close a balance of payments gap caused by the coronavirus, and is in talks with the fund over a standby loan.

GDP growth stood at 5 percent in January-March, down from a forecast of 5.9 percent, the cabinet said. The government has forecast that it will drop to about 1 percent in April-June.

 

Recommended





Advertisement

Comments

Your feedback is important to us!

We invite all our readers to share with us their views and comments about this article.

Disclaimer: Comments submitted by third parties on this site are the sole responsibility of the individual(s) whose content is submitted. The Daily Star accepts no responsibility for the content of comment(s), including, without limitation, any error, omission or inaccuracy therein. Please note that your email address will NOT appear on the site.

Alert: If you are facing problems with posting comments, please note that you must verify your email with Disqus prior to posting a comment. follow this link to make sure your account meets the requirements. (http://bit.ly/vDisqus)

comments powered by Disqus

Advertisement

FOLLOW THIS ARTICLE

Interested in knowing more about this story?

Click here