THE ARAB REPUBLIC OF EGYPT
MINISTRY OF FINANCE
SALES TAX DEPARTMENT

Minister Of Finance…

In pursuance of the Law No. "11" of 1991 regarding the promulgation of the Sales Tax Law . , and Law no. "17" of 2001 with respect to the application of the second and third phases of the General Sales Tax, as prescribed in law "11" of 1991; and the Minister of Finance decree no. "161" of 1991 in terms of promulgating the Executive Regulation of the General Sales Tax Law,

Decided...

Without prejudice to the provisions of the Sales Tax Law and its Executive Regulations issued by virtue of this applicable ministerial decree, shall hereby continue to be effective .

   The decree of the Minister of Finance No. "161" of 1991, herein before mentioned, shall be repealed. All other Provisions contradicting the attached Executive Regulations, shall be repealed

   The present decree shall be published in the Official Gazette and the same shall, upon the date of publication, come into force.

Issued on
20 ^th;June, 2001 Minister of Finance
Medhat Hassanein

   In application of the provisions of this executive regulations, hereinafter mentioned terms and phases, shall mean definitions which are explicit stated against each of said terms and phases:

Law:
Sales Tax Law

Table:
Each table annexed to Law or issued by virtue of presidential decree in implementation of provisions of said Law.

Taxable period
: One month period ending in last day of calendar month                                  whereon Registrant filled the "monthly tax return ".

Trader:

Distribution Agent assisting the Registrant:

Section ( 2 )

Imposition and liability of Tax

Article (2)

   In pursuance of rules, procedures and dates stipulated in the Law, the Registrant shall, in accordance with provisions of Sales Tax Law, collect and remit the tax amount to the Sales tax Department

   In accordance with the provisions of Article ( 2 ) of the Law , the exporter shall , upon exportation of the taxable commodities or taxable services , comply with the procedures established by the Customs and keep the documents related to the transactions and the documents that indicate the fulfillment of the exportation, including the exportation certificate issued by the competent Customs office or any substitute official certificate issued by the Customs .

The exportation may, through a third party, be completed provided that the exportation documents and the certificate herein before mentioned in the previous paragraph are to be provided within the period of the return submitted by the registerant.

Through the application of Articles (4) , (5) and 6  provisions , the following shall be observed :

1-The Registrant required to collect, declare and deliver the tax to the Department-  in accordance with the provisions of the law, shall be the following...

a- The industrial manufacturers

b- The importers.

c- The providers of the taxable services.

d- The distribution agents working for the taxpayers.

e- Merchants and the trade agents except those dealing in the commodities set forth in table no. "1" exclusively.

a- Selling a commodity which is locally manufactured by a taxable manufacturer.

b- Selling a commodity that is exported by same exporter in the local market aside from tax maturity at the time of customs release.

c- Services rendering by the taxpayer.

a- Transfer of the commodity manufactured among the production phases inside and outside the factory without prejudice to the tax liability on the service for third parties.

b- Transfer for manufactured commodities from the manufactured sites or the stores to the distribution outlets owned by the same registrant in accordance with the instructions that are included within the decision issued by the Commissioner.

Article (5)

   Through the provisions of Articles (7) and (8) of the Law , the procedures, terms and Conditions, guarantees and control systems which are applicable to customs duty, shall come into force in, respect of the commodities subjected to the Customs control.

   The Competent authorities shall define the commodities and services essential for conducting business authorized for projects located in the free zone, free cities and free markets .

Second …

   ommodities which are locally produced and are essentially required for conducting the business authorized for the projectes located in free zone, free cities and free markets, shall be treated as exported commodities. in accordance with the applicable provisions in such concern .

Third …

   In accordance with the provisions of the Law, the tax shall be due on the commodities or the taxable services, at the time of customs release, pursuant to the provisions of the Law, and which are imported for the purpose of local consumption within the free zones , free cities and free markets.

    The importation for the purpose of trading within any of the free zones that includes the entire city, shall be deemed local consumption .The tax shall, only, In case of supplying such commodities outside the free zones, free cities and free markets to the local markets, be due on the customs duties imposed on such commodities .

First...

   In application of the provisions of Article (11) of Sales Tax Law, the tax value that is to be declared and deemed as a basis for assessing the tax due on the taxable commodities and services , shall be the amount actually paid in return for such taxable commodities and services listed in the tax invoice issued by the registered seller to an independent purchaser, according to the natural circumstances .

 The department may have the right to, in other different cases, evaluate the taxable commodities or taxable services according to the prevailing market price guided by marketing and selling policies of the registrant, and by the common price of the same commodities with the same quality, the year of manufacturing, the specifications, country of origin and the trade mark, among other sellers and purchasers each of same is independent, at the same time, place and circumstances, and in accordance with justifications acceptable by the Department .

Second ...

 Through assessing the value of the imported commodities which is taken as a basis for the tax assessment at the stage of releasing such commodities from the Customs, the value taken as a basis for determining the Customs duties, adding to the same, the customs duties and other tax and duties that are due on the commodities shall be deemed acceptable.

Third ...

   Specified value for some taxable commodities or taxable services listed in the tables issued by the Minister shall be taken as a basis for assessing the taxable commodities or the taxable services .

Fourth...

  The tax base of the taxable services shall be the value of services mentioned in the invoice including consideration of services regardless any other fees or taxes.

Fifth...

   the common commercial deductions and allowance shall be acceptable in case the sale is by and between a registrant and a purchaser independent therefrom, and provided that the tax base is the value actually paid.

Sixth...

   The tax shall , at the time of supplying the manufactured commodities inside the free zones to the local market, be calculated on such commodities - as to the registrant - in accordance with the bases adopted for collecting the customs duties considering that the sales tax base shall be the whole value of the commodities to which are added the customs tax payable thereon and other imposed tax and duties.

Seventh...

   Whereas , with regards to the commodities totally exempted from the Customs duties , the value essentially taken to calculate tax upon releasing imported commodities from the Customs shall be only value accepted for Customs purpose.

   With regards to the customs tax partial exemption or the reduction of the customs tax, the tax base shall be the value essentially taken to calculate the customs tax adding to the said customs tax the reduced customs tax and other tax and duties imposed upon the commodities without prejudice to the reciprocal treatment in the international convention .

Eighth...

   In case of barter sale, the value of the commodity, which is taken as basis for calculating the tax, shall be the value of the commodity sold at the current price in the market.

   Through the application of the provisions of Article (14) of the Law, the registrant shall issue a tax invoice at the time of supplying a commodity or providing a taxable service. The invoice shall be issued in duplicate (original and copy ) . The original copy shall be delivered to the purchaser as the registrant keeps the copy . The serial number shall be recorded upon the invoices in accordance with the date of issuance . The tax invoice shall, hereby, includes the following details : -

a-The serial number and issuance date of the invoice.

b-Name and address of the registrant and its registration   number .

c-Name and address of the purchaser as well as its    registration number, if it is registered or is a well-known purchaser .

d- A statement includes the sold commodity or rendered service, its value and the prescribed tax rate, together with the invoice total amount

   With regards to the retailers who find any difficulty to issue a tax invoice for each transaction, the commissioner may create a simplified system for non - issue of tax invoice except when it is required by the purchaser.

   The production cooperative societies and cooperatives of productive families ( cottagei nductive) which purchase production requirements and sell to the registered members thereof from craftsmen, workshop owners, small plants and the productive families, may issue a statement accompanied by a selling invoice to the member , which indicates that the production requirements were purchased from registered producers or from registered importers, and that the cooperatives has previously paid sales tax, and indicate also that the amount of tax and due tax rate on such requirements in accordance with tax invoice .

   Such statement is deemed a document for the members to effect deduction which is stipulated in Article (23) of Law .

   In application of the provisions of article (15) of the Law, the registrant shall keep the books and registers stipulated in Law no.(17) of 1999 "promulgation of the trade law" as well as the books and accounting records in which the registrant shall register the transactions regularly ;they are as follows..

1- Purchases book: includes the details of purchase invoices or certificates of customs procedures;

2-Sales book: includes the details of the tax invoices issued on the registrant sales or services .

3-Returns book : includes the details of  invoices concerning returned sales and purchases through details of credit and debit notices ;

4-Exportation statement : includes details of exportation consignments serial number of certificate of customs exportation , date of exportation, exportation port and arrival place;

5- Store register: the stock in hand movement shall be recorded in it regularly ;

6- The original journal book: it shall be kept by the registrant whose invested capital exceeds L.E 20.000

7- Inventory book: it shall be kept by the registrant whose invested capital exceeds L.E 20.000;

8- Sales tax summarized book: it shall include the total transactions and dealings related to the tax ( indicating the number of each book from which these total are driven ) . This book shall include the following details:-

             a- Total value of sales and purchases excluding the tax .

             b- Total value of  Sales Tax charged on the Sales of the registrant and on the sales for special or private use an on any other disposals during                     every tax period respectively.

            c- Total of Tax charged on deductible purchases (inputs) .

           d- Settlements value in conformity with credit and debit notice .

           e- Tax required to be paid by the registrant for each taxable period after calculating the deduction.

If the registrant uses a computer system, the used data and files may be considered as an alternative for these books . As for the trader who applies one of the retail schemes, the trader shall keep the following books...

                       a- Purchases books.

                       b- Daily gross takings "sales book"

                       c- Sales tax summarized book .

   Without prejudice to the first paragraph of the above article, each and every registrant who produce any commodity listed in table no ." 1 " of the law shall keep ...

1- A book to record the raw materials used in the production of  taxable commodity.

2- A book to record the details of the manufactured commodities and transactions made by same

 
 

Article (10)

   pages of all records and books mentioned in article (8) and (9) shall be void of any empty space or writing in margins. The date statements "till roll" concerning the tax amount in case that the registrant uses (the revolving cash machine or the electronic sale equipment) may be considered and the commissioner shall issue the rules and procedures that related to the organization, control and verification of the above said date statements .

   The registrant shall keep the books, records ,invoice copies and the documents that include the till roll or the electronic sale data, for three fiscal years following to the registration of the data.

 
 

Article (11)

   In application of provisions of article "16" of law, each and every registrant shall, within thirty days subsequent to ending of each tax period, submit monthly return no.(10) on tax due on sales of the taxable commodities and taxable services to competent district offices. Such return shall, in accordance with article "32" of the law, be attached with the tax payment .

   The registrant shall consider completing the details mentioned in the purchases statement enclosed with the tax return , with namely are the invoice number and data, the amount, the deductible and undeductible paid sales tax, the seller name and the registrant number and the kind of the commodity or service .

   Same registrant shall, even if not achieving any taxable sales or any taxable services during account month, submit such return. The registrant shall, as to commodities listed in table no. (1) attached with the law, submit tax return no.(100) that is attached with the tax payment. If deadline of submitting return and paying tax coincides with an official holiday, the first subsequent working day shall be an accomplished day to such period.

   As to some importers who usually import one or two times a year, Commissioner may, without need for submitting monthly return by registrant, accept submission of return concerning month of import, if importation is effected in the same month of selling.

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Section (5)

Registration

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Article (12)

   In application of the provisions of Article (18) and paragraph (6) and Article "47" of Law each :-

A- Manufacturer or service provider who reaches or exceeds registration threshold;

B- Importer whatsoever value of sales thereof;

C- Producer of commodities of table (1) whatsoever value of sales thereof ;

D-Registered distribution agent whatsoever value of sales thereof;

E- The trader or the trader agent who reaches or exceeds the threshold;

   Shall, within a period fixed by a decision of the Minister, submit an application to the Department in order to register its name and details on form no. (1) attached to the document prepared for such reason.

   Each and every taxpayer, whose sales reaches or exceeds the registration threshold within any fiscal year or part thereof after effecting law shall, within month the sales or value of services rendered by same registrant reached or exceeds registration threshold, apply to the Department for registration .

   In all cases, the registration provisions shall not apply on the producers or importers whose activities are registered to exempted commodities; and also the traders who are working in the filed of the exempted commodities or of Table no.(1) goods.

   The details submitted by the productive cooperatives or charitable associations on sale value of members thereof or on sales value of the productive families affiliate to such entities shall, whenever reach the registration threshold set in the Law, be accepted.

   Each and every productive family shall be considered as an independent manufacturer and shall be considered a taxpayer who is subject to the provisions of the law if sale of same reach the said threshold.

   Hereinafter the rules and procedures shall be followed to register the taxpayers…

1- Submit the registration application to the competent District office of the Headquarter of the taxpayer.

2- The District office shall review the registration application to ensure the fulfillment of the information required, if it is clear that the information required is unfulfilled , the District shall provisionally register the taxpayer and forthwith notify the said taxpayer on from (2) in order to fulfill the registration application within a limit of period mentioned in the application. Fulfilled the registration application and same which are subsequently fulfilled shall be entered into the District record designated for the same purpose.

3- The District office shall identify the registration number of the taxpayer, issue the certificate of registration - form no. (3) and notify the taxpayer of such certificate enclosed with form (4) to be located in an obvious place in the establishment of same .

 
 

Article (13)

   In application of provisions of Article (19) of the Law, natural or juridical person, whose total sales value from the taxable and exempted commodities or from the taxable services do not exceed the specified registration threshold, may submit the application to register self name and details on form no. (1) attached with the said form .

   In case of registration, said person is deemed to be subject to the provisions of the said Law and shall follow the procedures and rules stipulated in the prior article (12)  .

Article (14)

1- The certificate of registration provided for in Article (20) of the Law shall be issued in accordance with form no. (3) attached, and such certificate is to be ratified by the Commissioner or the representative person so authorized and shall bear the seal of the state and sent to the registrant attached with form no. (4) "notification of registration " . The registrant shall place such certificate on an obvious place in the self headquarters, whereas other copies of such certificate shall be placed of the registrant branches to be under clients sight .

2- The registrant shall, in case of loss or damage of said certificate, demand official copy instead of lost or damaged certificate.

 
 

Article (15)

   In application of the provisions of Article (21) of the Law, whereas any natural or jurisdicial person, whether registered or is entitled to  registration shall ,within 21 days, notify the Department of any changes occurred in information filled in the registration application as to name, address, nature of main taxable activity or other activities.

New registration certificate in same number and of new information is to be issued provided that the previous certificate is to be returned.

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Article (16)

   In application of Article (9) and (22) of the said Law, the following shall be observed :

1- Whereas any registered person who loses one of the registration condition required by Law , may submit an application in written to the Commissioner in order to cancel the registration of such person,

the Commissioner shall cancel the applicant registration as of the last day of the taxable period wherein the cancellation is issued, the Department shall notify the applicant of the date of cancellation by acknowledged latter.

2- Any registrant entirely cease practicing the taxable activities or liquidating such activities shall, within a period not to exceed one month as of the date of cease or liquidation of the activities, notify the Department , the Commissioner shall cancel the registration as of last day of tax period wherein taxable activity is ceased .

3- The registrant or the person so authorized shall send the cease notification set in previous paragraph by acknowledged letter, wherein clearing date of cease and where registrant intend to recommence practicing the taxable activity during the coming year or not . The registrant shall keep the notification of deregistration- form (5) - all books and records , invoice copies related to the tax for three years after the deregistration .

4- The Commissioner may cancel the registration of any registered person by virtue of Article "9" of the Law if it is confirmed that the applicant does not practice the activity mentioned in the application of the registration. If it is clear the such person obtains a tax refund for inputs prior to perform any sales, the same shall return such refund.

5- If the registrant made a turnover less than the threshold set under the provisions of the Law, and the registration is cancelled, while practicing the same activity, tax shall be due on the commodities in possession of such registrant at the time deregistration .

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Section ( 6 )

Deduction, Exemption and

Tax Refund

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Article (17)

   In application of Article (23) of the Law, the registrant may, within the tax period, deduct from the total tax due on the sales value of the taxable commodities, the tax that has previously been charged on the following :

First :

   Returned sales in pursuance of the following terms and conditions...

1-The deduction shall only be effected on the tax previously paid on the returned goods .

2- The returned goods that has actually been receipted and entered into the regular books and records of the registrant and the purchaser received the value of the same goods including tax, or same goods entered into the registrant books under a suspense account .

3- The registrant issuance of a dated and serialized debit /credit note wherein containing details of the seller and purchaser .

Second… The input and purchases for trading purpose…

   The deductible input tax and purchases for trading purpose which the registrant may deduct from the aggregate amount of the tax due on the taxable sales within the tax period (provided that the registrant keeps the tax invoices of these amounts), shall be :-

1- The tax paid on the inputs contained in the locally manufactured commodities and also the purchases for trading purpose, if all sales of the registrant during the tax period are taxable .

2- The tax paid on the imported commodities during the tax period in accordance with the details of the certificate of the customs procedures .

3- In case that the tax previously charged on the inputs exceeds the tax charged on the sales during the account month, the tax due on the sales shall be deducted from the tax previously paid monthly on the inputs until exhausting such tax .

4- In case of a part of the registrant inputs during the tax period, is subject to the tax, the deduction shall be as follows:

a- The aggregate amount of the tax due on the inputs, which are used only in manufacturing the taxable outputs, whether the manufacture operation is performed during the tax period or afterwards, shall be deducted .

b- the tax due on such inputs which are used in manufacturing  the exempted outputs, whether the manufacture operation is performed during the tax period or afterwards, shall not be deducted .

c- the tax due on the inputs which are used in outputs, part of which is taxable and the other is exempted (items A and B) shall be deducted pursuent to the taxable outputs in proportion to the total outputs .

d- The above said rules shall be applied on the tax previously charged on the sold commodities by the registrant in each of the distribution phase.

e- The seller shall issue a credit note on the tax amount due on the inputs of the commodities exempted in items (B,C) if same registrant deducted such tax in the previous returns .

 

Third : Value Adjustment …

   In case that the transaction made between the registrant and another registrant resulted in an adjustment in the transaction value which is previously taxed by increasing or decreasing after submitting the return, the following shall be observed :

1- If the transaction value is adjusted by increasing, seller and purchaser shall record such increase in the return submitted by each one during the coming month subsequent to such event as follows :

a- The seller shall, in the self return, add the increasing of the tax in accordance with the credit notice to the tax due to the Department in own return .

b- The purchaser may deduct such increasing from the tax due on own sales as of input tax .

2- If the transaction value is adjusted by decreasing, the seller and purchaser shall observe clearing such decreasing in the return submitted by each one during the coming month subsequent to such event as follows:

a- The seller may, in self return, deduct such tax due on sales.

b- The purchaser shall, in self return, add such decreasing of the tax, in accordance with a credit notice, to the tax due to the Department in return as to the herein before mentioned in paragraphs ( first, second and third ) of this Article, the following conditions, shall be observed :

1- In case of returned commodities, the same are to be actually received and the details of the same are entered into the books and records .

2- The purchaser shall keep the document to prove that the deduction of price is actually made .

3-The seller address, registration number, name and address of the purchaser, number and date of the original tax invoice and all details required and related to the increasing and decreasing price, deducted or added value, and separate statement for tax deducted or added shall be clearly specified in the debit and credit notices .

4- The debit and credit notices shall be dated and bear special number

5- The percentage of the deducted tax in proportion to the total tax deducted on the purchases shall be the same percentage of the tax which is charged on the commodities in proportion to the price of such commodities .

6- The seller shall issue to purchaser "debit notice" wherein address and registration number of the seller , name and address of the purchaser, number and date of the original tax invoice, all details required and related to the deduction of the price, deduction amount and separate statement for deducted tax are specified.

7- The debit notice shall be dated and bear a serial number.

Forth:

   Subject to the provisions of Articles (3) and (19) of the Executive Regulations, in case that the value due to the registrant, as a result of exportation , exceeds the tax charged on the sales of the registrant ,within the tax period, the registrant may claim from the Department on the discrepancy between own dues of the tax paid for inputs contained in the exported commodities and the Tax charged on the registrant sales during the tax period wherein the month return is submitted upon the fulfillment of the requirements mentioned in Article "3" herein .

   The registered manufacturer, whose activity is restricted to exportation may, directly after exporting and within the limits of the self return and through the following procedures stipulated herein, claim from the Department on the refund the tax previously charged on inputs value of the actually exported production .

   The Department shall, in a maximum period of three month as of the date of submitting claim, refund mentioned discrepancies.

Article (18)

   The commodities and services enumerated in table no (1) attached with the Law may not be subjected to the deduction provisions herein before mentioned, whether such deduction is applied on the taxable commodities and services or as inputs in other taxable commodities and services .

Article (19)

   In application off the provisions of item (1) of Article (31) of the Law , the tax paid on the exported commodities whether with no charge or entered into manufacturing other commodities shall, within a maximum period of three months as of date of submitting claim, be refunded in accordance with the following conditions :

1- Purchasing the commodities from the registrant and the purchaser maintains tax invoice .

2-The commodities not to be second handed.

3- Exporting the commodities through the acknowledgement of the Customs Department .

4- Claimant shall attach the exportation documents and the tax invoice and keep the record of enter the details of exported commodities, number of exportation certificates and date of exportation .

5- In certain cases the Customs Department may, in an agreement with the Department, refund the tax previously paid for the exported

commodities and repatriated imported

commodities, whether such commodities will not change or entered into the exported local manufactures, in accordance with the customs procedures on the exported commodities.

   The traveler departing the country shall have the right to refund the previously paid tax to the registered seller on the traveler purchases for a value of not less than L.E 4000, provided that the said purchases are exported with the traveler within three months from the purchases date.

   The tax shall be refunded through the bank at the Customs outlet or the tax refund office at the Department by virtue of a check to be sent at his address . The administrative expenses shall be deducted at the rate of 5% of the total refund amount . The traveler shall have the above said refund upon submitting the following documents :

               - Copy of the passport.

               - The tax invoice .

               - Form 124 "GST".

The Commissioner may set any rules or procedures which are deemed to be necessary for refunding the tax on these commodities.

Article (20)

   In application of item (2) of Article (31) of the Law, the wrongly collected tax shall be refunded provided that the competent person submit an application specifies the amount wrongly collected and the reason of such mistake and noting tax period in which mistake is made and attaching the supported documents. Within a period of three months from submitting such application, wrongly collected tax shall be refunded.

Article (21)

   In application of the provision of Article (25) of the said Law , the exemption beneficiary shall submit a written declaration wherein the same commit only to dispose the exempted commodities, for other than purposes of exemption during five years subsequent to   the date of the exemption, upon notifying the Department and paying the due tax in accordance with conditions of commodities and the value thereof, and the applicable tax rate on the date of payment, unless otherwise provided for in reciprocity .

   - Hereinafter mentioned rules shall be applied ...

1- The exemption beneficial shall notify the Department of same desire to dispose or to change the usage prior to commencing the disposal .

2- Inform the Department of the approval of the Foreign Ministry on such disposal and that principle of reciprocity stipulates same.

3-The Department shall examine such commodities to determine the value of said commodities in accordance with the status thereof, the applicable tax rate and the amount of the due tax at the time of payment, and the Department may seek assistance from the Customs experts in such concern.

4-The Department shall draw a note of relief of the applicant conscience upon paying the tax or any other amount when it is due .

 
 

Article (22)

   In application of the provisions of Article "27" of the said Law , the provisions stipulated in the Minister of Finance decision n. (193) of 1986 issued in accordance with the Executive Regulations implementing Law no. "186" of 1986 on customs exemptions on the exported commodities, shall be applied .

   The local commodities specified in Article "27" of the said Law shall be exempted from the tax within the following limits ,terms and conditions:-

1- The samples used for the purpose of analysis processes in the government laboratories, on condition that submitting the relevant certificate issued from the government laboratories proving that such samples are analyzed and used .

2- The untradable personal belongings shall be exempted on condition that the competent person submits an application to the Department for exemption attached with a proof that such belongings deemed personal and same shall not be disposed to others within a limited period stipulated in the Law and a proof that the owner obtained such belongings from acknowledged sports, scientific or religious competition .

3- The exempted value of arrivers personal belongings from local or foreign commodities whether brought from abroad or from the duty free market or from the free zones, shall be valued by the same value of customs exemption stipulated in accordance with the provisions of the Customs Law .

Article (23)

   In application of the provisions of Article " 29" of the Sales Tax Law, hereinafter mentioned shall be observed ….

*First : The requirements of the Ministry of Defense :

1- The exempted commodities and services shall hereby be identified by a certificate from the Ministry of Defense accredited by the Chief of Financial Affairs Department of the Armed Forces or any person authorized stipulates that said commodities and services are deemed to be essential for the purposes of armament.

2- The provisions of this Article shall be applicable to all commands of the troops, Departments, Authorities and organizations of the Armed Forces and the Funds of the Ministry of Defense or affiliated thereto .

3- The said commodities and services shall be financed and purchased from the budget of the Ministry of Defense or from the resources thereof .

4- The Financial Affairs Department of the Armed Forces shall, with regards to the regulation of such exemption provisions, be the sole body to deal with same Department.

5- The Financial Affairs Department of the Armed Forces shall, in case of purchasing, importing or selling any commodity or supplying any services which is not to be exempted, forthwith notify the Sales Tax Department in order to take measures of collecting due tax .

6- The Commissioner shall, in agreement with the Chief of the Financial Affairs Department, issue a decision to constitute a joint committee from the Sales Tax Department staff and from the Financial Affairs of the Armed Forces staff pursue the executive procedures concerning such exemption .

7- Hereinafter mentioned procedures shall, for applying the said exemptions , be pursued :-

a- The Ministry of Defense shall, to any manufacturer, importer or a provider registered as may be the case, draw a certificate accredited by the chief of the Financial Affairs Department of the Armed Forces or by any person so authorized, affirming that the requirements needed for the Armed Forces are essentially for the purposes or armament .

b- The registrant shall sell to the Ministry of Defense discharged with the tax and issue the tax invoice showing that such commodities supplied to the Ministry of Defense are exempted in pursuance of Article "29" of the Law and entering same invoice data in the books of said registrant.

c- The competent exemption units of the Ministry of Defense shall, in the books of such units, enter the data to the tax invoices by the registrant.

8- In application of the tax exemption as to exported commodities, said agreement on regulation of the customs exemption procedures shall, as to the commodities exported by the Ministry of Defense for the purposes of armament or for the benefit of same, be effected.

9- The Chief of the Financial Affairs Department of the Armed Forces shall notify the Commissioner of the name of the person so authorized for issuing said certificate and of the signature of same person.

*Second : The requirements of other entities ...

1- The provisions of Article " 29 " of the Law shall be applicable to the requirements which are essential for the purpose of Armament to defense and national security required to the following entities:-

 

a- Companies, units and organization of the Ministry of Military production .

b- Ministry of the Interior .

c- Arab Organization of Industrialization .

d- The organization of National Security .

2- The Ministry of Defense or the competent chief of the unit or the person so authorized shall issue said certificate affirming that such requirements are essential for the purposes of Armament to defense and national security provided that notifying the Commissioner of the name of the person so authorized and the signature thereof .

3- The provisions and procedures stipulated in items 3,5,6,7 and 8 of paragraph (First) of this Article shall, as to such entities each in thereof competence, be effected .

4- The entities herein before mentioned shall pay the Tax due on all own commodities purchased for the purposes contradict with those stipulated in this Article, and pay the tax due on all commodities sold to the tax free bodies.

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Section ( 7 )

Tax Collection

Article (24)

   The registrant shall, to the competent local Sales Tax district office, pay the tax due on each time period, attached with the registrant monthly return, at a date not to exceed 2 months following the expiry of the tax period, except the tax return of April for which the tax shall paid not later than the 15^th of June . With regards to Table (1) Goods, the tax shall be paid within the month follows the expiry of the tax period

   The Commissioner may determine the district office which receive the monthly return, the tax due and the method of payment

   The declaration term may be extended by virtue of a decree of the Minister, as necessary , in accordance with Article "16" of the Law.

   The Commissioner may issue a decision determining the procedures of the tax collection, in accordance with the nature of certain commodities .

   The Tax due on the imported commodities shall be settled in the stage of its release from the concerned Customs unit, at the time of settling the tax duties, and in accordance with the Customs procedures prescribed in this respect. These commodities shall not be finally released from the customs outlets before the due tax thereon is paid in full .

   Whereas the Commissioner may, temporarily release the production machines and the equipment supplied to the factories and are essential for the production operation in pursuance of the terms and conditions of payment, limits, rules and guarantees defined by the Commissioner decision, such commodities may not, before paying the due tax in full be finally released .

   The Commissioner may determine the suitable guarantees for the amount of the tax due on the commodities released on export, and also under any of the special customs schemes.

Article (25)

   The additional tax shall be due at the rate up to half percent ( 0.5% ) of the defaulted tax value for each week or each part thereof that succeed lapse of the due date of payment specified in the Article mentioned above.

   In case that the tax is not paid in the due date, the Department may take measures of the administrative seizure to settle the payment of the tax and the additional tax and any other duties.

Article (26)

In application of the provisions of Article (33) of the Law, the taxable services shall be deemed in continuous nature, if such are rendered regularly and persistently in order to fulfill the requirements of the beneficiary thereof ,and such service value shall be collected in accordance with the invoices issued in terms scheduled by the services providers. Services of continuous nature shall be identified by a decree of the Minister in each case respectively .

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Section ( 8 )

Control

Article (27)

   In application of the provisions Article (40) of the Law, whereas the tax control shall be based upon the documents and the books, the Commissioner may, in certain cases and for special consideration regarding the nature of the commodities, set controlling procedures and may establish a controlling system for said procedures.

   Subject to the previous paragraph, the following shall be considered as of table no. (1) goods attached to the Law …

* First...

1- Pure alcohol may only be transmuted to fuel or to industry purposes in alcohol production plants ( if exported) in customs zones. Alcohol transmuting process shall, in all cases, be conditioned in the presence of a committee from the Department constituted by a decision of the competent general manger .In case that the transmuting of alcohol for the industry purposes is made under special industrial system, the approval of the Industrial Monitoring Authority for each case respectively shall be essential .

2- Upon the completion of alcohol transmuting to fuel or to industry purposes, triplicate samples of the output and materials used in the transmuting process shall be taken, and vessels wherein transmuting is made shall be stamped. The quantity of alcohol shall only be released upon receiving the analysis results from the chemical laboratories which affirms that such samples are sufficiently transmuted .

3- The owners of the plants and laboratories who are entitled to have transmuted alcohol for industry purposes shall keep the books and records showing the quantity received and acts of processing same such books and records shall be under the supervision of the Department .

4- The transmuted alcohol for industry shall be alcohol transmuted to be used in basic industries identified by a decision of the Commissioner in agreement with the Director of the Industrial Monitoring Authority. The material and ratio of the transmuting process, for each case respectively, shall be defined in same decision.

*Second ...

   The plants and laboratories which produce fresh grape wine and grape juice defermented by adding alcohol and alcoholic beverages shall keep records for entering different stage of manufacturing (fermentation, distillation, rectification, denaturalization, lightening and bottling ). The department shall be notified, at least 24 hours, before each operation to delegate the appropriate official to monitor such operation and to seal the equipment and tools. Whereas the concerned person shall, forthwith after the distillation and fermentation of wine, define the date of bottling, produced quantities shall remain under the direct monitor of the Department until such quantities are bottled.

   The representatives of the Department shall record the bottled quantities and affix certain marks 'Banderole' and record amount of the due tax . Said representatives shall take the required declaration against the registrant to pay the tax, such procedures shall be recorded in the minute signed by both representative of the Department and the registrant or the person legally authorized thereby .

2- The person concerned shall, within 24 hours subsequent to bottling the alcoholic beverages which contain the untransmuted pure ethyl alcohol with concentration degree of (800) or more, notify the Department, in order to enable the Department to delegate the representatives to examine the records kept by the registrant wherein purchased quantities of the pure alcohol which denaturalized and bottled are entered, and to examine the purchase invoices, and to deduct the denaturalized and bottled quantities from same invoice, and to take the declaration from the person concerned indicating that the denaturalized pure alcohol is tax paid, and such alcohol is not resulted from another alcohol which is procured by distillation by same registrant, or by alcohol transmuted for industry or fuel .

   Certain mark prepared for such reason, on the responsibility of the person concerned, shall be affixed to the bottles as to discriminate between such kind of beverages and other beverages specified in paragraph (E) and (F ) if item no. (7) in table no. (1).

3- In conformity with table no. (1) attached to the Law, the person concerned of producing the perfume and the cologne shall keep the records for entering the purchased quantities of pure alcohol used in producing same; the concerned person shall register the number and date of the invoice in the records.

*Third ...

   On transporting, from one town to another, any quantity of alcohol or alcoholic beverages or alcohol transmuted into fuel exceeds ( 5 liters ) of the unmixed alcohol, whether being imported or locally produced, shall be abided by obtaining the relevant license from the Department . The said license shall only be issued upon verification that such quantities are tax paid .

Article (28)

   The Department may obligate certain registrants to use the cash registering machines or the electronic sale equipment on which the tax due on their sales is shown . The Commissioner shall set the rules and procedures of controlling such machines .

 
 

Article (29)

   Without prejudice to the provisions of Law no. (92) of 1964 on tobacco Smuggling, whereas the establishments licensed to produce the common cigarettes, tuscany, pipe tobacco, mild-testing tobacco,snuff, chewing tobacco and shaggy tobacco mixed or unmixed shall keep the records to record the quantities of tobacco purchased and entered into the manufacture process, the person concerned shall keep the offirming documents .

   The importer shall notify the local competent District Office of the entities whereto the tobacco is sold by same, and disposal of remaining imported tobacco within 15 days following the month of selling.

   The registrant who manufactures the raw tobacco shall enclose a statement of the quantity and quality of the manufactured or disposed tobacco with the monthly return of the registrant submitted to the local competent District office .

Article (30)

   In application of the provisions of article (42) of the Law, each of the Commissioner, the Head of the competent sector and the Head of the competent Central department shall be authorized to compound for the violations prescribed in the present Law, against the payment of the due tax and additional tax and the indemnification within the limits of the fines prescribed in Article (41) of the Law .

Article (31)

   In application of the provision of Article (45) of the Law, no criminal action shall be lodged or any procedures taken in the tax evasion crimes, except on the basis of an authorization from the Minister.

   The Commissioner shall be mandated to compound for the evasion crimes prescribed in the Law, while the Head of The competent sector shall be authorized to compound for the tax evasion crimes not exceeding the amount of the taxes and the additional taxes and the indemnification amount to 50 thousand pound ( L.E. 50.000 ) .

Article (32)

   Accepting the request for considering the reconciliation concerning the crimes of smuggling the commodities set forth in table no. (1) attached to the Law, shall be examined on condition that such petition contains waiving seized commodities, or paying the amount thereof in case that the commodities are not seized .

Article (33)

   In application of the provisions of Article (46) of the Law, the person concerned shall be responsible partner or managing director or chairman, who is responsible for actual administration is conformity with applicable regulations, provided that the administration of the establishment shall notify the competent District Office of the name of the responsible manager and notify the said office of the name of the new responsible manager when changed.

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Section (9)

Miscellaneous Provisions

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Article (34)

   In application of the provisions of paragraph (1) of Article (27) of the Law, and without prejudice to the application of the law provisions concerning the imposition of the sales tax on the operation services of the third parties, the process of packaging, bottling, refining, clearing or grinding shall not be considered as a change in the condition of the commodity, and the tax shall not be due on the commodities listed in Table (1) attached to the law, at the time of circulation within the distribution phases .

The registrant who are dealing with Table no. (1) goods , attached to the law, may adjust the tax account on the returned sales from the tax due in accordance with the tax return and also the conditions and controls determined by the Commissioner decision.

Article (35)

In application of paragraph (3) of Article (47) of the Law, the samples analysis taken from the commodities enumerated in table no. (1) attached to the Law shall , under the following specifications, be :-

1- sufficiently enough to be analyzed and represent the nature of the commodity.

2- In triplicate except in seizure case, sample shall be in duplicate.

3- Stamped with sealing wax and sealed with stamp of a representative of the Department and a stamp of a person concerned or with the fingerprint of the person concerned in the case of evasion .

4- Affixed with label containing details of sample and name of the owner thereof and the date of taking such sample. Said label shall be signed by the person concerned and a representative of the Department or a delegate of the competent unit when necessary .

5- In case that the person concerned refrain from stamping sealing wax, or signing, fingerprinting, or stamping label, the signature of the delegate of the competent unit and the representative of the Department shall be accepted whereas the label shall contain that person concerned refrained from signing .

6- First sample shall be sent to the analyzing competent entity or to the relevant expert nominated by the Department, second sample shall be kept in the Department warehouse and the third sample shall be given to the person concerned if the sample was in triplicate.The person concerned shall submit the required affirmation to preserve such sample and not to break seal and not to dispose sample before receiving the result of the analysis process .

7- The samples shall be confirmed in the relative record of the Department.

8- The procedures herein mentioned above shall be written in a minute.

9- Whereas the sample kept in the Department warehouse shall be given to same sample owner, in case that the analysis results are positive or upon the completion of the purpose where for the sample is taken, sample which the analysis results are negative shall be executed upon taking all the procedures whether by final sentence or by conciliation.

  The person concerned may not claim the Department for the sample price .

   The person concerned or the self –representative may, in cases other than seizure or surprisingly taken sample, request for analyzing the sample located in the Department warehouse on the self-expenses by the following procedures hereinafter mentioned :-

a- Composing a committee of the competent staff of the executive unit to ascertain the soundness of the seals fixed on the sample, in the presence of the concerned person or its representative.

b- In case of the sample re-analysis, the result shall be final. In case of the difficulty to analyze the sample kept with, the Department, the sample kept with the concerned person shall be analyzed .

Article (36)

   In application of the provisions of paragraph (4 , 5) of Article (47) of the Law, the following shall be observed:-

1- Any person licensed to establish or operate a firm or a laboratory to produce taxable commodities shall notify the Department of such establishment on form prepared for such reason .

2- In case of full or partial cease of the establishment the Department shall be notified on the relevant form within the period defined by the Commissioner.

Article (37)

   In application of the provisions of paragraph (10) of Article (47) of the Law, the compensation and the remuneration for services and work performed by the employees of the Department for persons concerned at times or other than official working time shall defined as Follows :-

First …

   Opening of cashier office after specified times two pounds shall be paid for each payment slip.

Second :

   The Department shall collect the transportation fees for the employees of the Department in return for making operation for the benefit of the person concerned as follows :

- Whereas 50 pound shall be paid to the Department, if the transportation is inside the town of the competent sales tax District Office,100 pound shall be paid if the employees were many. Later amount shall be multiplied if the transportation is outside the town of the competent District office, in addition to the travel allowance pursuant to specified categories .

- The person concerned shall deposit such fees in the Department cashier before transportation.

Article (38)

   The prices of printings and banderole stamps and distinctive marks and sale and analysis fees by the competent person shall decided by a decree of the Minister.

Article (39)

In application of the provisions of Article (39) of the Law, the Department may dispose seizures and tools of evasion and means of transportation which are sentenced to be confiscated in accordance with the following rules :

1- In accordance with the provisions of the Law, whereas the seizures and the tools of evasion and the means of transportation which are sentences as to local commodities shall be deposited in the Department warehouses prepared for such purpose, imported commodities shall be deposited in the seizure warehouses of the Customs Administration until issuing the final sentence on proceeding or attribute to each of the two Departments as a result of conciliation .

2- The Seizures, smuggling tools and articles, and the means of transportation referred to the above shall not be deposed of except after attribute same to the Department or the Customs Administration as a result of conciliation or the rule on the proceeding issued .

3- Disposal of the seizures, smuggling tools and article, and the means of transportation referred to , by sale, shall be enforced by virtue of a resolution of the Department or the Customs Administration Commissioners according to each case, which within the limits of its competence, according to the provisions of the Law no. (89) of 1998 on the reorganization of adjudication and bidding, its executive statutes and its amendments .

The General Authority of the Government Services shall exercise the sale procedures in accordance with the rules legally prescribed in this respect .

4- Without prejudice to the provisions of the Law, whereas the the Department or the Customs Administration Commissioners may, each within thereof competence, dispose the seizures and the tools of evasion which are perishable or liable to decrease by bidding before ruling on cases that may not be tendered . Sale proceeds shall be deposited in trust until it is proof that such commodities are finally attributed to the public Treasury for long .

5- The embargoed commodities or those which damage the public health or the commodities which are not to be introduced for sale because of the safety of the citizens after consulting the competent technical bodies shall, by a decision of the Department or the Customs Administration Commissioners, each in thereof competent, be annihilated.

Article (40)

The Commissioner shall issue the decisions and the circulars essential for enforcing the provisions of these Executive Regulations, same shall have the power to amend the attached forms or/and cancel the new forms, in accordance with the work requirements .

Article (41)

The Commissioner may determine certain special procedural rules essential for applying the provisions of the Law, in accordance with the nature of certain registrant activities . This shall be agreement with the different associations and organizations joint thereby or to which it is attached .

Article (42)

In the application of Article “23” of the law, and with regards to the sales tax extension, the registrant shall have the right to deduct from the due tax, the previously paid tax due on the stock in hand that the registrant has bought for the purpose of selling the said purchases .

Such stock in hand which in the possession of the registrant in the day prior to the date of the beginning of the tax collection, by virtue of the tax sinvoice and under the controls, rules and limits issued by decision of the Commissioner .

In case that there is no tax invoices available to indicate the previously paid tax, the tax amount due for the Department shall be 1.5% of the commodity selling price which is equal to the tax on the value added by the trader, provided that the stock in hand shall be disposed of within a period not to exceed October 2001

Thanking into consideration that any sales for the stock in hand after the defined period , the provisions of collection, remittance and credit stated in the law shall be applied herein.