How Will Government Apply The Wealth Tax Plan?

The government reconsidered the upward scale of the tax on wealth by reducing it, proposing to raise the threshold of imposing the tax from 5 billion centimes to 10 billion centimes in addition to reducing the progressive percentage in the tax calculation scale from 1% to 0.25%, along with dropping the argument of the wealthy in evading this tax based on the approval that it meets with another tax and produces double taxation.

Governmental sources to Echorouk that the supplementary finance bill for the current year reviews the tax on wealth by adopting a new account schedule based on a specific upward rate of 0.25% with raising the threshold for applying the tax to 10 billion cents, according to the new measure, each wealth of fewer than 10 billion Cents will not be subject to this tax in exchange for those that equal or exceed this level, 0.25% will be deducted, while financial values that exceed 15 billion centimes, 25 billion cents, 35 billion centimes and 45 billion centimes are determined as levels that are approved for the gradual increase in the progressive ratio set to 0.25%.

“Therefore, wealth with a value exceeding 15 billion cents will be subject to a 0.5% deduction, of which more than 25 will be deducted 0.75%, and that which is greater than 35 billion cents will be subject to a deduction rate of 1%, while wealth with a value greater than 45 billion cents will be subject to a tax of up to 1.25%”.

“The tax on wealth, which was present in the financial laws for the past four years despite its absence in practice and the controversy it raises every time it is discussed at various levels, the government decided to reduce this tax cut. The valid upward scale depends on an upward rate of 1%, starting at 1% and ending at 3.5%. The initiation of the same deduction ratios will start from 5 billion cents”.

“The Supplementary Finance Bill of 2020 proposes to completely abandon the property tax that it began to apply in 1993, considering that the tax on wealth will be a substitute for it and by this, the Ministry of Finance has dropped the argument of double taxation that the wealthy were trying to hide behind to avoid paying the tax on wealth”.

Houses of less than or equal to 45 billion cents will not be subject to tax on wealth, which is the same for rental properties, used furniture, jewellery, precious stones and minerals, in addition to dues, deposits, guarantees, insurance contracts upon death, and life pensions that are paid to individuals until their death.