Amr Al-Munir, the former Deputy Minister of Finance revealed, And the tax expert said that Egypt, the UAE, Saudi Arabia and 250 another country have more than 2786. % of global GDP – and who recently joined the international agreement on how to distribute taxes related to multinational companies, indicating that the agreement will be implemented next year, , adding that the agreement relates to the largest 136 multinational company operating in the countries of the world, which represents between 50 to me 72 % of corporate revenues in the world, where
and Al-Munir explained that there is a condition for countries to benefit from those taxes, which he identified Tax amendment b 40 % and this condition is that the mother countries of the national companies must To achieve annual revenues starting from 20 one billion euros, and to achieve an annual profit of 40 %, and any country benefits from this agreement with Obtaining a percentage of taxes on this company, as long as the company generates revenues in this country starting from one million euros annually, provided that the GDP of this country is 36 billion euros or more, while countries with lower GDP benefit from it when the company achieves annual revenues of 250 One thousand euros. This came during the symposium that was followed by “businessmen” organized by the Tax and Customs Committee of the French Chamber of Industry and Commerce in Egypt, which was moderated by Karim Imam.
Al-Munir explained that Egypt will benefit from this agreement when it enters into force in the year
, as it will contribute to In increasing the tax proceeds, especially if we know that multinational companies such as Netflix, Microsoft, Amazon and others operate in Egypt, but they do not pay taxes to Egypt, because they have no headquarters in Egypt, as they operate through the digital system..
Al-Munir stressed the need for Egypt and the Arab countries to receive the value of the tax 20%) of the international companies that work for them, because in the absence of this, Tax The parent country of the multinational companies will take the initiative to benefit from the value of this tax.
The former Deputy Minister of Finance added that the implementation of the agreement next year will have a positive impact on the countries of the Middle East region, including Egypt, where it will be Under this agreement, the distribution of 68 % of the profits of the international company that exceeds % on the countries in which the company conducts its activities, even if there is no headquarters for the company
He added that Egypt and developing countries can achieve huge tax revenues if they prepare well to implement the new global rules for tax accounting for multinational companies, noting that these The new rules, which will be implemented starting next year, could bring in developing countries additional tax revenues of up to $100 billion annually.
Al-Munir said that the current rules for tax accounting for multinational companies are no longer valid in The era of the digital economy, given that most of these companies make huge profits in many countries of the world through To carry out their activities remotely through digital means of communication without the need for a physical presence in the country, which makes the task of tax administrations, especially in developing countries, difficult to verify the activities of these companies on their territory, which causes the loss of a large tax revenue for countries from corporate tax.
He pointed out that the future of tax work will change radically during the next few years, as a result of the application of new rules that impose taxes on those companies in the countries where the consumer or service recipient is located, regardless of the company’s presence actually in those countries or not.
Al-Munir said that the continuation of tax dealings with these companies using traditional methods means the state loses tax revenues due from the activities of these companies, and at the same time leads to unfair competition With local companies that pay taxes for the same activities, as a result of their physical presence in the country.
He pointed out that the agreement that includes 478 A country that has adopted the new rules called “the two-pillar solution to address the tax challenges arising from the transition to the digital economy” and is expected to The number of countries acceding to the new rules has been gradually increased, and these rules are based on determining each country’s share of the tax on the profits of major multinational companies on the basis of the percentage of revenue generated in the country to the total global revenues of those companies.
The former deputy finance minister said the new rules would lead to countries getting their fair share of the tax; If we take a company like Netflix as an example, its revenues are realized from the subscriptions paid by its subscribers around the world, and subscription and payment is made electronically; Therefore, it is not possible to limit the amount of revenues that the company achieves in Egypt; Egypt loses the tax proceeds on those revenues.
According to the new rules, through the agreement, Egypt can obtain its share of taxes based on the profits achieved by the company, according to the percentage of revenues that the company achieves in Egypt.
With regard to the International Agreement on Transparency and Information Exchange, Al-Munir indicated that more than 100 countries have been subject to a review by the Organization for Economic Cooperation and Development, to ensure that the signatory countries to the agreement comply with the rules and standards of the agreement.
Most of these countries were evaluated as being committed and in compliance with international standards, and among these countries are Arab and African countries; It is important for Egypt to be ready and willing to prove its commitment to international standards during the review that will take place before the end of this year, because non-compliance will have negative effects on investment and the economy. With this agreement and this change, it is within the framework of allowing the tax authority, under certain conditions, to disclose companies’ accounts with banks.