EATE demands permanent exemption of factories from real estate tax
The Egyptian Association of Tax Experts (EATE) welcomed the Council of Ministers’ decision to extend factories’ exemption from real estate tax until 2026 and stressed that the decision contributes to enhancing production and stimulating investment.
EATE said that perhaps the time has come to consider exempting factories from the real estate tax once and for all.
Tax accountant Ashraf Abdelghani, founder of EATE, said that the Cabinet’s decision came under the directives of President Abdel Fattah El-Sisi to confront the difficult circumstances facing the industrial sector, including the rise in prices of production supplies, the disruption of global supply chains, the fluctuation in the price of the dollar, the slowdown of the global economy, and rise in inflation.
He stressed that the industrial sector is the axis of development, which requires the state’s support to be able to complete its role in economic activity, maximize production capacity, enhance competitiveness and achieve sustainable development.
Ashraf Abdelghani said that extending the exemption of factories from real estate tax until 2026 may allow enough time to discuss the exemption of factories from real estate tax permanently or at least to put new accounting bases for the real estate tax on factories based on the structural value and not the market value on the basis that the owner of the factory does not benefit from the rise in the value of the land. It is not a consumption unit, but a productive unit that provides job opportunities, meets local needs, reduces imports, increases exports and enhances the state’s foreign reserves.
He also warned that after the end of the temporary exemption of factories from the real estate tax, there will be a significant increase in the value of the tax as a result of the "five-year assessment" process carried out by the state every 5 years, which will lead to higher commodity prices and disrupt the financing structures of investors.
Akhbar Alyoum Gate