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Egypt Independent
14-04-2025
- Business
- Egypt Independent
Rising vegetable and fruit prices in Cairo leave citizens worried
Cairo markets have witnessed a significant increase in prices of vegetables and fruits, coinciding with a two-pound increase in octane and diesel prices per liter. This has impacted the prices of certain daily necessities for every household. During a tour of al-Sayeda Zeinab market on Sunday, Al-Masry Al-Youm observed a significant increase in the prices of some goods. The price of bananas rose by LE15 per kilogram, from LE 30 to LE 45. The price of tomatoes jumped to LE 10 per kilogram from five LE. Eggplants rose from seven LE to LE 12.5, guava from LE 30 to LE 40, and onions from LE10 to LE 12. Citizens express concern Market vendor Abdel-Rahman attributed this increase to increased transportation costs, a direct result of the fuel price hike. He said, 'We are forced to raise prices because the cost of transporting goods from farms to markets has increased significantly, and suppliers have also raised their prices.' Housewife Samia Hassan expressed her concern about this sudden increase, stressing that her family's income is no longer sufficient to cover basic needs, prompting them to stop purchasing fruit every week and reduce the quantity of vegetables they consume. An employee and mother of five, Amal Saeed, shared similar worries: 'All prices have increased dramatically. We can no longer afford basic daily needs. A kilo of lemons has reached LE 120.' Economic expert Ali al-Idrisi anticipates markets to witness a significant wave of price increases and inflation rates, all as a direct result of the increase in fuel prices. He emphasized that this increase will not be limited to energy prices alone, but will also impact various goods and services, both directly and indirectly through its impact on economic activity. Speaking to Al-Masry Al-Youm, he added that although current inflation rates remain high, new increases could further complicate the economic landscape, posing significant challenges for both the state and citizens. He called for rapid intervention and balanced measures to limit the effects of inflation and ease the burden on citizens. A complex relationship Agricultural expert Saddam Abu-Hussein believes that the increase in the cost of agricultural production will not necessarily lead to an immediate or direct increase in product prices in the markets, as prices are subject to other factors such as supply and demand and various pricing mechanisms. He explained that the relationship between cost and final price is more complex than some people think. In statements to Al-Masry Al-Youm, he stated, 'The cost of growing a particular crop may increase, while its market prices remain stable or even decrease, depending on market conditions and the quantity supplied.' Abu-Hussein said that for example, tomatoes used to sell for five LE per kilo, even though their cost exceeded that amount, and now, after fuel price hike, they are selling for up to LE 10 – whereas the cost of growing them before the increase did not exceed six LE. The rising costs of diesel may impact the ability of farmers to maintain the same farming pace and may prompt some to reduce their cultivated areas, he added, particularly for crops that require significant effort and expense. This ultimately impacts supply and leads to a gradual rise in prices, Abu-Hussein explained. Edited translation from Al-Masry Al-Youm
Al-Ahram Weekly
28-01-2025
- Business
- Al-Ahram Weekly
Tax overhaul - Economy - Al-Ahram Weekly
MPs approve three draft laws that seek to offer incentives to small investors, simplify procedures and speed up the settlement of tax disputes Following lengthy discussion on Sunday, the House of Representatives approved three tax-focused draft laws offering new incentives to small-scale enterprises, unifying and improving tax services and speeding up the settlement of disputes. 'The drafts aim to improve the financial performance of the state and promote investment,' said House Speaker Hanafi Gebali. He expressed the hope that the laws would enhance Egypt's ability to attract international investment. According to Finance Minister Ahmed Kouchok, the three laws are the first phase of a package of measures that will overhaul the tax system and ease the burden on taxpayers. 'The package has been discussed with key economic players and, on the basis of these discussions, has been amended to meet the needs of taxpayers and investors,' said Kouchok. MPs gave final approval to a 15-article draft law granting tax incentives to businesses with an annual turnover of up to LE20 million. The original draft submitted by the government had placed the threshold at LE15 million. It was raised at the request of Abdel-Hadi Al-Qasabi, parliamentary spokesman of the majority Mostaqbal Watan Party, who argued the increase was necessary given high inflation rates and the depreciation of the Egyptian pound. A report prepared by the Budget Committee said the draft bill seeks to support small and micro enterprises (SMEs) while expanding the tax base and integrating informal businesses into the national economy. Article 7 states that businesses with an annual turnover below LE20 million will be exempted for five years from financial development fees, stamp tax, company registration fees, land registration fees and tax, and fees linked to credit facilities and mortgage contracts. Article 8 exempts the same businesses from capital gains tax on the sale of fixed assets and production machinery and Article 9 contains a blanket tax exemption on profits. Article 4, however, exempts companies that generate 90 per cent of their annual turnover from consultancy services from the provisions of the law. Mohamed Suleiman, head of the House's Economic Affairs Committee, said the draft legislation is in line with Egypt's 2014 constitution which requires that the government support small and micro-scale enterprises and start-ups. He pointed out that 'small-scale enterprises contribute 80 per cent of Egypt's GDP and play a leading role in creating job opportunities, meeting local market needs and boosting exports.' Several MPs objected to Article 3, which stipulates that businesses must join the Egyptian Tax Authority's (ETA) Electronic Invoice and Receipt System to benefit from the package of tax incentives. MP Talaat Abdel-Qawi criticised the law far including NGOs and civil society organisations involved in development projects as part of the private sector for tax purposes even though they are non-profit entities. He argued that many NGOs will find the requirement that they join the ETA's Electronic Invoice and Receipt System burdensome. In response, Kouchouk said exempting entities from the Electronic Invoice and Receipt System would undermine the government's strategy to expand financial inclusion. MPs also approved a draft bill that will allow taxpayers who failed to submit their tax reports by the deadline to file them without facing financial penalties. A government-drafted explanatory note said taxpayers who fail to submit their tax reports on time currently face fines of up to LE1 million. Article 3 of the new law will allow taxpayers who failed to submit their tax returns for 2020, 2021, 2022, and 2023 to do so without incurring penalties. The third law aims to expedite the settling of tax disputes within the framework of the ETA's shift to a digital system. Deputy Chairman of the Budget Committee Mustafa Salem said the value of late tax payments had reached LE400 billion and 'hopes are high that the new law will help recoup this sum ahead of the ETA moving to a fully digital system.' Kouchok told MPs that by streamlining the way in which tax disputes are resolved, the 11-article law will contribute to creating an attractive investment environment and building greater trust in the tax system. 'The law will also help the ETA settle accumulated tax disputes while moving away from a paper to a digital system,' said Kouchok. He argued that the draft laws open a new chapter in the relationship between the ETA and the business community, based on partnership and support, and will allow the ETA to focus on upgrading its services and expanding the tax base to benefit the state, investors, and citizens. * A version of this article appears in print in the 30 January, 2025 edition of Al-Ahram Weekly Short link:
