Income tax

Electronic merchants authorized to register for income tax with domicile: ETA

E-merchants operating in Egypt could register for income tax using their home address, according to Reda Abdel Qader, chairman of the Egyptian Tax Authority (ETA).

The taxpayer must submit a photocopy of the lease or ownership contract of his residence, in addition to a recent electricity bill billed to the registered address to open a tax file.

In a statement released on Monday, Abdel Qader said the finance ministry seeks to achieve tax justice by including e-commerce in the tax community, as part of the government’s efforts to include informal economic activities in the formal system.

He explained that all natural persons and companies that engage in commercial or non-commercial activities, whether through electronic platforms or traditional channels, are subject to income tax in accordance with Law 91 of 2005.

The authority has also asked individuals and businesses that use social media networks for e-commerce to register for income tax and VAT – in case their income reaches EGP 500,000 per year – in accordance with the law.

There are three types of businesses that get into the e-commerce business: First, businesses use e-commerce as one of the various means of selling or distributing. Second, businesses primarily depend on electronic means to sell and distribute their products and services. Third, companies use digital platforms to promote other companies’ products to customers.

In addition, all companies that carry out commercial or non-commercial activities (free professions) are subject to income tax in accordance with Law 91 of 2005.

Abdel Qader said ETA has assigned hotline 16395 to receive inquiries relating to the taxation of e-commerce and online content creation activities.

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