Abstract:
This working paper aims to discuss a proposal to consolidate more than 2,400 fees and taxes imposed by multiple government entities into a “consolidated tax” in order to reduce the financial and administrative burden on investors, and achieve greater transparency and fairness in the collection of fees through a single entity. In addition to the introduction, the paper consists of five main sections. Section I discusses the current situation, using quantitative and qualitative analysis. It sheds light on the actual burdens incurred by investors during project establishment and operation stages, as well as the associated costs. Section II examines the expected benefits of implementing a consolidated tax, including simplifying collection and increasing fairness and transparency. It highlights the most important legal and administrative challenges that may hinder implementation, such as the problem of integrating fees into a tax base and the risks of revenue fluctuations. It also discusses government scenarios for implementing the proposed consolidated tax. Section III presents country experiences of similar reforms, highlighting their successes and the entailed challenges in order to draw lessons applicable to the Egyptian context. Section IV offers an alternative approach to gradually implementing the consolidated tax, beginning with restructuring the current collection environment, then progressing to issuing new legislation and implementing it in stages, while including performance monitoring indicators to ensure effective implementation and the sustainability of the reform. Finally, Section V concludes with offering recommendations for the successful implementation of the proposal.
