09/12/22

EGYPT: New tax law amendments will not breach secrecy of personal banking accounts, says Central Bank.

As published on english.ahram.org.eg, Thursday 8 December, 2022.

New amendments to the 2020's Unified Tax Procedures Law will not allow the Egyptian Tax Authority to obtain secret information about the personal banking accounts of ordinary citizens, confirmed the Central Bank of Egypt (CBE).

In a statement on Wednesday night, the CBE outlined that "the legislative amendment complies with international agreements that were signed by Egypt and other countries who are members of the Global Forum for Transparency and Exchange of Information for Tax Purposes."

"We would also like to stress that the law guarantees that personal accounts and deposits with Egyptian banks are kept secret and that the secrecy of these accounts can be broken only upon a written request from holders of these accounts or their legal representatives, or upon a final judicial verdict," the CBE stressed.

Some members of the public had raised concerns that the amendments to the 2020 law gives the Tax Authority access to secret information on bank accounts.

The amended law would add a paragraph to article78 of the CBE law, which stipulates that articles 140 and 142 of CBE's law on secrecy of banking accounts will not prevent banks from exchanging secret information on the personal accounts of their clients in compliance with international tax agreements effective in Egypt.

Mohamed Soliman, the chair of the House's Economic Affairs Committe, explained to Ahram Online that the amendment only allows exchange of information between Egyptian and foreign banks for the purpose of fighting tax evasion and stemming the attempts of some clients to hide their financial assets and riches.

"So the amendment is just related to exchanging information in line with international agreements effective in Egypt and is by no means related to disclosing information on the personal accounts and deposits of citizens with Egyptian banks or divulging their industrial, commercial and professional secrets," said Soliman.

The draft amendments to the 2020's Unified Tax Procedures Law were referred to the House of Representatives – Egypt's lower house parliament – on Tuesday.

House speaker Hanafi El-Gebaly said he had tasked the House's Budget Committee and the Economic Affairs Committee with discussing the new amendment.

The Cabinet's Media Centre stressed in a statement on Thursday that "officials in the Ministry of Finance have strongly refuted claims that the amendment, which is currently being discussed by the House of Representatives, will give the Tax Authority the green light to obtain secret information on the personal accounts and deposits with Egyptian banks."

According to the centre, "the amendment only allows some foreign countries to verify the commercial deals of their citizens in order to be able to contain potential tax evasion deals and in compliance with international tax agreements effective in Egypt."

The statement stressed that Egypt joined the Global Forum for Transparency and Exchange of Information for Tax Purposes, which was founded in 2000, in 2016.

"This leading international body, which works under the auspices of the Organisation for Economic Cooperation and Development (OECD), addresses tax evasion, tax havens, offshore financial centres, tax exchange agreements, double taxation and money laundering," said the statement.