Central Bank rejects Egyptian Tax Authority proposal for disclosure of accounts

The governor of the Central Bank of Egypt said on Sunday that the bank would not, under any circumstances, accept a proposed amendment to the Income Tax Act allowing the Finance Ministry to access bank accounts belonging to corporations or individuals. Tariq Amer was responding to the head of the Egyptian Tax Authority, Emad Sami, who revealed earlier in the day that an amendment has been drafted to allow the Minister of Finance to access corporate bank accounts to help combat tax evasion.

According to Sami, the Tax Authority has drafted an amendment to Article 99 of the Income Tax Act, allowing the Minister of Finance to see bank accounts, without conflict with the law governing the Central Bank or current judicial procedures. He said that the new amendment would allow the Tax Authority to verify the banking data of clients who are suspected of submitting incorrect information about their income. The process would include the submission of a formal request by the Minister of Finance to the Central Bank before the disclosure of any information.

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The Central Bank official, however, told state-run magazine Al-Ahram Al-Ektisadi that the bank was keen on preserving the confidentiality of bank accounts, in line with the bank law which regulates relationships with clients. Amer added his belief that the Finance Ministry’s request is a breach of the law, which compromises the confidentiality of accounts.

Egypt is seeking to boost its income by increasing tax revenues to 18 per cent of GDP, up from 14 per cent currently. According to Finance Ministry data, the ratio of the tax revenue to the gross domestic product was 12.5 per cent from fiscal year 2012/2013 to 2016/2017. The fiscal year in Egypt begins on 1 July until 30 June of the following year, in accordance with the General Budget Law.