Egypt is expecting more than 500,000 cars to be imported into the country by expats looking to take advantage of the scheme
Egypt is looking to attract around EGP 50 billion ($2.5 billion) worth of foreign currency from the recently announced scheme that will allow Egyptian expats to import personal cars exempt from customs duties and taxes, revealed Finance Minister Mohamed Maait yesterday.
Speaking to Bloomberg Asharq, Maait stated that the initiative will allow Egyptians living abroad to purchase new cars in exchange for hard foreign currency.
Egypt is expecting more than 500,000 cars to be imported into the country by expats looking to take advantage of the scheme.
Maait revealed that it could go live in 2-3 weeks.
The draft law, approved last week by the Egyptian Cabinet, enables Egyptian expats to import one private car to Egypt where buyers will pay customs fees, value-added tax (VAT), and other taxes upfront in foreign currency, but will receive a full return on these duties after five years.
Expats will have the dues returned to them in EGP at the recorded USD-EGP exchange rate at the time of withdrawl and without interest, explained the cabinet.
According to the draft law, expats can invest the value of saved customs duties and taxes in foreign currency in a five-year certificate of deposit (CD), but without earning interest.
The exemptions are valid for a four-month period starting on the day the law comes into effect.
The initiative has garnered special interest among Egyptian expats in the Gulf, who total more than 3.5 million, Maait noted.
Customs and tax duties that are currently imposed on vehicles imported into the country could exceed more than EGP 3 million, he said.
To use the import scheme, expats must be over 16 years old, have a legal residence and a bank account outside of Egypt that is at least three months old.
In a separate interview on Saturday, Minister of Emigration and Expatriate Affairs Soha El Gendy stated that the draft law has wide support among MPs and so could be passed by the House of Representatives within days.
The initiative would only apply to new cars that are manufactured in 2022 or second-hand cars that are no more than three years old in order to protect the environment, said El Gendy.
If an expat does not import a car within a year after depositing the money to the finance ministry, they will be able to immediately recover the deposit in foreign currency, according to the draft law.
