By imposing fees, Egypt’s new parliament begins offering loyalty to the regime

“A parliament that serves the system and its agenda, not the people.” This was the impression many Egyptians had in the first days of the parliament’s work when it approved a bill imposing new fees on people who are suffering from a financial crisis. Most of them fall below the poverty line. In its first session, parliament approved a bill to increase “the resources of the Fund for the Honouring of Military and Police Martyrs in War and Terrorist Operations” by imposing fees and taxes on employees and citizens.

There are no official figures on the fund’s resources, nor the money that is supposed to be devolved to it annually, or the number of army and police families that benefit from the project, nor the fund’s outcome compared to the dues of those families covered by the law. What is noteworthy in the law is that all its resources are deductions from employees’ salaries and fees for several government services that citizens also pay for, amid questions about the state’s role in light of citizens incurring additional costs to increase the fund’s resources.

The Egyptian government justified the increase in the proceeds of the fund, with the abundance and multiplicity of its commitment to compensate the families of the victims of the army and the police, and the provision of health and educational care, sports, cultural and recreational activities, Umrah, Hajj, and other multiple benefits. Critics say that the new parliament law, the first in its legislative laws, reflects the continuation of the financial deduction policy required by the government and approved by parliament, which threatens more taxes, deductions, and fees.

Meanwhile, deputies in the new parliament defended the law, saying that this is the tiniest thing that the House of Representatives can offer to those who sacrificed their lives for this country’s future. They indicated that they would also work to provide job opportunities for these and their families, as regulated by law.

On the other hand, during the session, the Speaker of Parliament, Chancellor Hanafi Jabali, commented on the demands of some MPs for doctors to include corona victim doctors into the law, that the matter requires a new bill from the government or the Ministry of Health. Jabali’s statement means returning doctors’ demands to square zero, according to Rashwan Shaaban, a member of the General Syndicate of Physicians. Rashwan revealed that the doctors would continue to communicate with the Minister of Health in this regard. He said, “We had hoped that the issue would end with the convening of the new parliament, especially since we had received promises from the prime minister to treat corona victims as we treat army and police martyrs, and to provide them with a decent life.”

Regarding the amendments to the Medical Professions Law, which includes the establishment of a fund to compensate for the risks of medical professions, which was approved by the President of the Republic, Shaaban explained that the fund was not formed. Its executive regulations and disbursement mechanism have not been established, and that all that is happening so far is the collection of the funds stipulated in the decision. The analytical statement of the draft budget for the fiscal year 2020-2021 showed that the Egyptian government plans to increase taxes and reduce government support for petroleum products.

The Ministry of Finance aims to increase tax revenues by about 12.6 per cent to about EGP 964.7 billion ($61.5 billion dollars). During the past year, the Egyptian government took several decisions to increase budget revenues and taxes, imposed huge fines for building violations, and collected more than EGP 17 billion ($1.1 billion), the outcome of a quarter of the value of violations, and extended the reconciliation period until the end of next March.

Last May, the former House of Representatives approved amendments to developing state resources laws by increasing fees imposed on some government services and introducing new ones on some activities, consumer goods, and bills. Last December, the Egyptian government decided to limit the support provided to ration cards to a maximum of two children per family. The family bears the burden of the third child under the pretext of facing a steady increase in the population.

The Egyptian government has deducted one per cent of net employee income and 0.5 per cent of retirees’ pensions, starting from 1 July 2020, for 12 months, to contribute to facing the corona pandemic crisis. In the following month, the Egyptian Ministry of Transport raised the prices of tickets for the three subway lines, which carry about 3 million passengers a day, at rates ranging between 40 per cent and 60 per cent in order to develop services.

For his part, economist Ahmed Zikred Allah says that “charging citizens with deductions and other fees is unacceptable.” He points out that the basis for this is that the state budget bears these funds’ expenditures in the expenditure section, not the citizens’ pockets. They pay annual taxes collected by the state to respend them in such matters as other expenses.

The remembrance of God criticises the great imbalance in the state budget, as a large part of it goes to the payment of installments and interest on debts, whether domestic or foreign, which have reached unprecedented levels and thus revenues and taxes remain much less than the size of expenditures. He adds, “If these revenues were provided without the debt installments and their interest, the state budget would have recorded a surplus unprecedented in its history.”