Tax Authority President Abdel Moneim Matar talked to Al-Masry Al-Youm about information linkage, the VAT, late arrears and raising taxes on liberal professions.
He said the Constitution forbids tax privileges to anyone, except within the law.
Matar also said that reform is for the benefit of the taxpayers, the Tax Authority and the laws, adding that the Tax Authority seeks to capitalize on international experiences.
He added that combining the sales tax and the income tax is a good step towards reform.
Q: Will you be able to implement the tax linkage scheduled for the 2015-2016 fiscal year amid the current tension?
A: I am confident of it.
Q: What is the rationale of Law 91 of 2005?
A: To support the taxpayers by reducing the tax burden so that they voluntarily and smoothly pay their taxes.
It levies ascending taxes for individuals, proportional taxes for companies and reduced taxes for small projects, while low income social brackets are exempted.
Q: Have legal amendments increased tax revenues and achieved justice?
A: By all means. The government has reduced the high tax end to 22.5 percent.
Q: Are there flaws in the tax system?
A: We keep resolving taxpayer problems through our dispute resolution committees.
Q: Is there anyone above the tax law?
A: No one is above the law. The Constitution forbids tax privileges to anyone, except within the law.
Q: Which international model should we follow in terms of the institutional structure of the Tax Authority?
A: Our institutional structure is 80 years old and has been updated several times. Merging the General Tax Authority and the Sales Tax Authority in 2006 was a good step towards reform. We are always keen on capitalizing on the experiences of other countries.
Q: Is there a mechanism for the collection of sovereign taxes?
A: The term sovereign taxes refers to the taxes collected from sovereign bodies, such as the petroleum sector, the Suez Canal and the central bank. I do not like this term because all taxes are sovereign to me.
Q: When will the information linkage between the Tax Authority, the Customs Authority and the insurance system be completed?
A: We are working on it.
Q: When will the problem of late arrears end, especially that it involves large amounts?
A: The amounts are exaggerated. Late payments are due to court challenges.
Q: Are there obstacles with the Finance Ministry and the government?
A: We are part of the Finance Ministry. We always work on removing obstacles.
Q: How big are the tax losses and who bears responsibility?
A: If you mean by losses the difference between what should be paid and what is actually paid, we cannot calculate this accurately, but we try to reduce it by curbing tax evasion. The new legislative amendments will help in this regard.
Q: Are the administrations combating evasion doing a good job?
Q: How can you avoid unfair arbitrary tax estimations?
A: There is corruption in every ministry because this has to do with ethics. But we do our best to combat it and be fair to the taxpayers.
Q: Why do legal disputes take so long?
The Supreme Constitutional Court said ordinary courts should not handle income tax disputes.
Q: When will the tax on free professions reach its target?
A: We are working on it.
Q: What is meant by broadening the tax base?
It means covering more taxpayers and reducing losses by including the informal economy in the system.
Edited translation from Al-Masry Al-Youm