Strong Growth With lucrative Incentives
Investment Facilitations and Incentives
As part of the State's vision to enhance the business environment and provide a more attractive investment climate, Investment Law No. 72 of 2017 and its amendments was enacted. This law represents a significant milestone, offering investors a comprehensive set of legal guarantees along with substantial facilitation in the procedures for establishing businesses and obtaining licenses, ensuring a smooth and secure launch for new projects. In line with efforts to achieve sustainable development and attract more local and foreign investments, the law grants distinctive tax and customs incentives, particularly for projects in areas most in need of development, thereby contributing to economic justice and driving investments across all regions of the Republic.
General, Special and Additional Incentives
Investment Law No. 72 of 2017, along with its subsequent amendments, seeks to promote and attract domestic and foreign investments by offering a variety of incentives tailored to the type of business activity, the project's location, and its contribution to sustainable development. The law categorizes these incentives into three main types: general incentives, special incentives, and additional incentives.
Non-tax Incentives for Inland Investment Framework
Investment Law No. 72 of 2017 does not only provide tax and customs incentives, but also includes a wide range of non-tax incentives and facilitations that are essential to improving Egypt's investment environment.
Free Profits Transfer
Investors may collect their project profits and transfer them abroad.
Facilitating Exports
Any investment project may export its products, directly or via an intermediary, without the need to be registered at the Register of Exporters.
Freedom to Finance Projects
Investors may establish and expand their projects, finance them with foreign capital from abroad in foreign currency without restrictions.
Residency for Investors
Foreign investors shall be entitled to residence permits valid for the entire period of the project's operation.
Facilitating Imports
Projects may import, directly or via third parties, the necessary supplies for their setup.
Employing Foreign Workers
Foreign labor may comprise up to 10% of the total workforce of any investment project. This limit may be raised to 20% if qualified national labor is not available.
Non-tax Incentives for Investment and Technological Zones
Investment Law No. 72 of 2017 also stipulated a wide range of non-tax incentives and facilitations for investment and technological zones projects.
Work Plan
The investment zone`s BoD shall have the authority to establish the rules governing business activities within the zone.
GAFI`s Approval
No governmental authority, other than GAFI, may undertake any action within the investment zones, except with the prior approval of GAFI.
Projects Approval
The investment zone`s BoD have the authority to approve projects that will be established within the zone.
Various Custom Facilitation
Rules of temporary release and drawback stipulated in the laws, regulations and decrees shall apply to all projects operating within the investment zones.
Granting Operating Licenses
The BoD`s Chairman shall issue operating licenses to approved projects, without the requirement for registration in the Industrial Register.
Free Zones Incentives (Public and Private)
Pursuant to the Investment Law No. 72 of 2017 and its subsequent amendments, Free Zones represent one of the State’s main investment frameworks aimed at attracting investors, especially those involved in export-oriented activities. These zones provide a set of distinctive advantages, including exemptions and facilitations related to taxes, customs, and administrative procedures.
Tax Incentives
Projects located within free zones and their profits are exempt from applicable taxes and fees in Egypt.
Expansion of Projects
Projects can be established in petroleum, fertilizer, iron & steel, natural gas, and energy-intensive industries within the free zones system.
Goods Tax Exemption
Exported or imported goods are exempt from customs duties and value-added taxes (VAT).
Import & Export Exemption
Exported or imported goods are exempt from import/export rules and related customs procedures.
Equipment Exemption Taxes
All tools, machinery, and necessary means of transport are exempt from customs duties and value-added tax (VAT).
Exemption from Import Rules
Imports into the country shall follow general regulations, with waste from activities allowed entry for safe disposal or recycling.
Special Economic Zones Incentives
Special Economic Zones are granted a variety of incentives under Investment Law No. 72 of 2017, in addition to tax and non- tax incentives, as outlined below:
Special Incentives
The project shall be granted a 50% deduction of the investment costs incurred for 7 years, starting from the date on which the activity has actually commenced.
One-Stop Shop
SCZone provides a one-stop shop for companies’ incorporation and post incorporation services, to save time and effort and expedites administrative procedures.
0% VAT
Exemption from added-value tax over goods or services exported by the zone’s projects abroad, and on goods or services provided by the local market to the Zone.
Export & Import Restriction
Economic zone projects are not subject to the laws regulating import and export, nor are they subject to registration in the Registers of importers or exporters.
Customs Duty Exemption
Exemption from customs duties on equipment, machinery, raw materials, and spare parts imports needed to manufacture products intended for export.
Participation in Training
The Economic Zone shall pay a portion of the technical training costs for Egyptian workers, as per the regulations and under general and fair conditions.