Advertising Campaign Motivating Citizens to Pay Property Tax

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Advertising Campaign Motivating Citizens to Pay Property Tax

Post by DJKeefy »

Advertising Campaign Motivating Citizens to Pay Property Taxes.

An advertising campaign for Egypt’s Real Estate Taxation Authority (RTA) has drawn the people's attention calling on citizens to start paying taxes before mid-August.

Although the current law has been in force for nearly a decade now, but it has undergone many amendments that have hindered its work, which means this would be a new experience for many Egyptians.

"I think many citizens will respond to the advertising campaign," said Ashraf al-Arabi, former head of the RTA and current MP.

According to the law issued in 2008, the rental value of the properties is estimated once every five years. The annual tax value, which is calculated at 10 percent of the rental value of the property, is determined based on this procedure, excluding maintenance expenses.

The law has raised controversy among citizens in light of the fact that real estate represents a refuge for the Egyptian families’ investments and it has overcome several amendments. The most recent of these amendments was the 2014 taxable benefit according to the first estimate as of July 2013, provided that this assessment continues until the end of December 2018.

Head of the RTA Samia Hussein said in a statement that property owners who are entitled to tax will be subject to penalties for delay if they don’t inform the RTA of their properties before August 15.

Real estates that are prepared to be leased in summer are one of the most important havens for Egyptian families who invest in their properties during this period of the year. Therefore, the RTA tried to attract this category by announcing the possibility of paying the tax on the northern coast units and remote areas at the Authority’s headquarters in Cairo instead of doing so in a coastal governorate.

According to date by the country’s Ministry of Planning, real estate activities accounted for about 10.5 percent of the country's GDP in the fiscal year 2016-2017.

However, not all real estates in Egypt are taxable. The law exempts private housing units with an annual rental value of more than EGP 24,000 per year (about $1,300), commercial and industrial units with an annual rental value of more than EGP12,000 and other facilities such as educational institutions and non-profit hospitals

Source: https://aawsat.com/english/home/article ... erty-taxes


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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by newcastle »

At least it's an impost that mainly affects the wealthier - those who have second properties and probably rental income to go with it. I expect many might try and recoup the cost by raising rent but their ability to do so will depend on whatever lease terms apply.

The idea of advertising is novel. Are they intending to extol the virtues of paying ones taxes? That would be an interesting idea. You never know......Egyptians happily funded the Suez Canal extension so they have shown some willingness to make patriotic gestures :lol:


Egypt must have one of the least efficient tax collection systems in the world. I can't see property taxes adding much to the state coffers.

On the other hand it'll give jobs to another legion of bureaucrats.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Major Thom »

Been in the offering 10 years and still not sorted out yet???? God God...
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Dusak »

Well all I can say is good luck to them. My friend says that the folk she knows with more than one property that is rented out has never paid tax. The guy that build my place has at least 25 rented properties now, never paying a penny property tax, while me, I'm up to date but still get the odd knock at the door asking for it. But they never knock on next door that rents out three.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Major Thom »

When the Government come to measure and put my villa on the maps both they and myself were amazed to see that Gorf was 5 times larger than what they had information on, in fact mine should have been the only villa down our road, according to plans, instead they found a further 5 properties unknown to them. Maybe a proper survey would actually reveal just how much cash is owed from this farce called property tax. You cannot rely on people to come forward and pay their tax if you do not know where their property is. That's the lazy mans way of saying tell us if you have a home...
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Dusak »

When I first moved into my home here, every four years a small plane used to fly over Luxor, including Karnak, taking aerial photographs to spot any new unlicensed buildings so their maps could be updated. They no longer do this.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by newcastle »

Dusak wrote:When I first moved into my home here, every four years a small plane used to fly over Luxor, including Karnak, taking aerial photographs to spot any new unlicensed buildings so their maps could be updated. They no longer do this.
Unless those balloons....... ;)
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Who2 »

Wasn't that noisy little plane taking tourists on a jaunt ? I know Stan went on it once.... 8)
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Dusak »

Who2 wrote:Wasn't that noisy little plane taking tourists on a jaunt ? I know Stan went on it once.... 8)
That was another one. I first saw it as I was overseeing the building of this place, was circling over for 3/4 days. It was the guy building that told me what it was doing.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Major Thom »

It may just be another story coming out from Enid Blyton "D"
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by A-Four »

Dusak wrote:
Who2 wrote:Wasn't that noisy little plane taking tourists on a jaunt ? I know Stan went on it once.... 8)
That was another one. I first saw it as I was overseeing the building of this place, was circling over for 3/4 days. It was the guy building that told me what it was doing.
Yes you are correct Dusak, I remember the small plane went from north to south in lines up and down all along the WB.

One interesting thought, although not very happy is that unlike the British method of property tax reevaluation, I am sure the government said at its introduction that it would rise every 5 to 10 years. Being that there has been such a massive devaluation of the LE plus rampant inflation, I dread to think what the new, perhaps revised bills will be.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by newcastle »

Revaluations are to be performed every 5 years.

Any increase in valuation is limited to a maximum of 30% for domestic residences.

I don't see why general inflation, fuelled largely by the withdrawal of subsidies, would automatically translate to property valations. Any link to currency devaluation is even more dubious.

The currency devaluation will mean that many foreigners are only paying half the amount originally assessed in 2013/14....in their " home" currency. For most it was, in any event, a fairly trivial amount.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Major Thom »

Even limited to a 30% rise that seems a very substantial increase in a Country suffering high inflation, but in line I suppose with other increases of between 20 and 70% over the past couple of years. At the moment though people must be getting worried about when these hyper price rises will cool... At the moment there is no signs of price rises slowing at all. when price rises are set, you cannot go on the fact of foreigners income, the rises have to be based on local income and just how much you can push and push before the powder keg explodes. Unless of course the next action will be a dual economy, (That has been going on for years in many places), where the Authorities set a budget for foreigners and one for local people.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by A-Four »

Dusak wrote:Well all I can say is good luck to them. My friend says that the folk she knows with more than one property that is rented out has never paid tax. The guy that build my place has at least 25 rented properties now, never paying a penny property tax, while me, I'm up to date but still get the odd knock at the door asking for it. But they never knock on next door that rents out three.
I remembered reading this statement by Dusak a few days ago, so I think it may be prudent to bring new information that may enlighten your friends of the government of Egypt's future intentions. They have been inundated with long queues at many property tax offices throughout the county with people pay their back dated payments. I am sure many may wish to disbelieve believe this, however the authorities have, for this reason, extended the period for payment from August 15th to October 15th.

It seems the authorities are seeking remittance from people who have failed to pay the property tax since 2014, and these are to be vigorously pursued, what that means there is no further information.

I am not in the habit of bringing what could be suspect hearsay information, but, social media in Egypt seem to believe that a letter leaked from the Central Bank of Egypt that those who owe money to the Property Tax Authority will have their bank accounts frozen. This has been strongly denied by the Central Bank, however, it is interesting to note that it appears the signature on the document is authentic of a high official within that institution.
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by newcastle »

Of course there's been a rush to pay back- dated tax!

The new system was backdated to 2013/14 but they've only got around to issuing the bulk of the tax demands this year as they were forever chopping and changing the tax formula.

As for freezing accounts etc.....another rumour in a country where conspiracy theories are the norm :lol:
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Who2 »

Post subject: Re: Advertising Campaign Motivating Citizens to Install Smart Meters.

Here's another con by the energy companies 'smart ? 'I don't think so and definitely wont be having one.... 8)
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Re: Advertising Campaign Motivating Citizens to Pay Property

Post by Hafiz »

I don't think its quite what it seems or that it will have negative effects on poorer people and advantage richer people - as if that's a first.

First you can deduct 1/3 rd of the 'expected' rental of the property (assessed by a reliable mistress killers company) from the total tax to give a net abount of tax payable. How this works for poorer properties that have no rental real market I don't know nor how it works for the millions of houses/flats, particularly in Cairo and Alex that are rent controlled I don't know. What I do know is that rents in the upper glass tank protected suburbs surrounded by barbed wire and 9 foot concrete fences - are high. Therefore the deduction will be high.

Secondly, more clearly and more worrying, the tax will inevitably lead to higher rentals and the capacity of poorer people to cope with that must be low.

Third it will mean that poor people living in in demand areas, like Maspero triangle north of the old museum, may be hot property by large general property market movements which hugely increase their taxes and drive them out because a few blocks away they are building $US1 million flats. This negative effect will fall more on renters.

How it works for people buying houses/flats under Muslim financing - I don't know because I don't know when the title passes to the purchaser in these deals.

Its a safe bet based on 50 years of mal-administration that the rules are unclear/potential for bribes high, the people managing it ill educated and ill trained, there are no booklets of guidelines/policies - just fluffy adverts, the courts will be inconsistent but not as nearly as inconsistent as the administrators, if you are rich you will get the result you want etc and the implementation planning is non existent as is concern for the poor. Does Egypt have a profession or sworn valuers to do the valuations or would any sane human believe them? Are there quick, trusted and informal dispute resolution systems. Given the years to prepare for this has the government done anything to build systems - like valuers or reliable data bases of sale/rental prices by type of property or region.

A side point. Its a state secret but western academic researchers have published that there are hundreds of thousands of unoccupied/unsold apartments in the satellite cities. Will rich developers be up for 10's of millions $. I doubt it. http://www.tadamun.co/2015/12/31/egypts ... 3Q4GpMzbeQ and https://www.reuters.com/article/us-egyp ... SKBN1FH0BM Its very hard to make sense of except that a centrally/military planned economy produces contradictions - on the one hand huge oversupply and on the other its opposite. These satellite cities are probably the worst of the Junta's very many disasters/waste.

Another side point. There is a strong argument that the rent control systems in central Cairo and Alex have caused their near wreckage. In simple terms the unbelievably low rentals mean that property owners won't spend money on them and decent people wont move into run down buildings. Its more complex but every idiot knows, except in Egypt, that removal of rent controls is required if you want to revitalize an old city. NYC faced this in the late 60's and early 70's and took the decision every other sane city has. In addition, as in Cairo, rent control is subject to huge corruption.
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