Sisi’s regime is abusing taxes and fees

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President Abdel Fattah Al-Sisi’s regime is seeking to increase the revenues of the public budget, which suffers from a chronic deficit, due to the increasing cost of debt service, which leads him to borrow hundreds of billions of pounds annually to fill the deficit. This is a welcome matter in itself, but instead of the regime working to increase revenues through expansion in industry, agriculture, establishing revenue-generating projects and increasing exports, it imposes taxes and fees directly and indirectly on citizens, until the matter turns into “collection.” The regime even imposed taxes on illegal activities such as private lessons, drug dealing, weapons and prostitution. Although it asserted its illegality, this did not prevent it from asking those who engage in these activities to pay taxes, given that this is “tax justice.”

A few days ago, the Tax Authority called on those who manage private lesson centres, whether associations, halls, apartments, or by teaching via electronic means and others, whether owned or rented, to go to the tax office in which the headquarters of the activity is located and notify the tax office of that, whether it already has a tax file or it is to open a new tax file, no later than one month from now. Private lessons are private teaching classes that students resort to to compensate for the failure of public education to perform its role, and teachers resort to them to compensate for their acute low wages and the high cost of living. This activity, despite its spread, is prohibited, as the state launches campaigns from time to time to close private tutoring centres and punish those responsible.

Some considered the tax declaration as a prelude to legalising and recognising the status of private tutoring centres, but their urgent interest was to stress that the notification of the tax authority on the activity of tutoring and the opening of a tax file “is not a legal basis for legalising the status of private tutoring centres.”

The Tax Authority threatened those who refuse to notify it of their activity in private lessons, to apply the provisions of the Income Tax Law No. 91 of 2005 and its amendments, and the Unified Tax Procedures Law No. 206 of 2020, explaining that “the activity of private lessons centres, like any commercial or professional activity that results in profit, and thus obtain of which there is a tax,” stressing that the incident of “tax evasion is a crime against honour.” It is assumed that the state is fighting private lessons and seeking to stop them, so how then is the person who carries out this activity supposed to apply to the IRS to report and confess to committing this activity. Nobody explains. This brings us back to previous statements made by IRS officials, who asserted that “drug dealers, arms dealers, prostitutes, and others who continue to engage in illegal activity are subject to income tax upon arrest.”

The “taxes” stressed that if the drug dealer admits to practising his activity for a specified period of time, he pays a tax for this period, as the authority “discusses” him to find out “how much the dealer has earned, and takes the tax return from his confession,” then asks him to pay the tax or be legally punished. The Tax Authority stresses that “collecting tax from these activities is not a recognition of their legality, as they are legally criminalised, but a recognition of taxable revenue.” It is not clear how such activities are taxed, as it is assumed that all funds of persons convicted of such crimes are confiscated by the judiciary.

High fees for dozens of services with no return

Since President Abdel Fattah Al-Sisi took office in 2014, the prices of goods and services have been increased in a hysterical manner. The president was not satisfied with lifting subsidies on gasoline and electricity, and what his “economic reform” plan resulted in was increased numbers of the poor and burdened families.

For example, the fee for obtaining a passport in 2014 was EGP 135, but after a series of increases the fee reached EGP 700, an increase of 400 per cent. While the fees for obtaining a private car driving licence increased from EGP 300 in 2017 to EGP 1,072 in 2021, an increase of more than 250 per cent, and the fees for obtaining a national ID card increased from EGP 15 in 2013 to EGP 45 in 2021. This is a sample of dozens of services whose fees have increased over the past few years, without a logical reason to increase their prices, or even a return on the service itself, which made it seem like the state’s desire to increase its resources at the expense of the citizen, as the citizen is now held accountable for the government’s failure.