Egypt’s textile and yarn companies are calling for a delay of the implementation of a new sales tax, according to Al-Sharq Al-Awsat daily. The projected tax is supposed to have been implemented under the third phase of the national sales tax program. So far, only the first and second phase of the plan have been executed.
The textile industry has requested that the unpopular measure be put on hold until parliament approves new amendments of the common tax law.
Shopowners throughout Egypt responded to measure with an extensive protest campaign. However, the strike has not succeeded in derailing government plans. The first phase of the General Sales Tax Law went into force nearly a decade ago, in 1991. Only industrial producers, service providers and importers had been paying the tax in this initial stage, reported the Reuters news agency.
The upcoming final phases of the sales tax law are to be imposed on over 3.5 million wholesalers and retailers in Egypt, whose turnover exceeds 150,000 Egyptian pounds ($39,000) per merchant.
One of Egypt's oldest industries, textiles is the country's largest manufacturing sector after food processing. Textiles and apparel exports generate $800 million annually and constitute one-fifth of the country's total exports to the European Union and the United States.
Egypt’s textile exports are a crucial part of the country’s economy. Mustafa Al-Rifai, Egypt’s minister of industry and technological development maintained, in a recent interview to Al-Sharq Al-Awasat , that major markets for Egyptian textile goods existed abroad, noting that China was one of the most promising destinations for Egyptian textile imports. — (MENA Report)
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