Explainer: How Can Egyptians Abroad Import Tax-Free Cars to Egypt?
Explained: How Can Egyptians Abroad Import Tax Free Cars into Egypt?
For years, Egyptians living abroad struggled to import their vehicles to Egypt due to customs, taxes among various other complications. In October 2022, the Egyptian cabinet approved the tax-free car import initiative, which allows Egyptians living abroad to import cars to Egypt, based on a set of conditions.
Under this initiative, Egyptians over the age of 16, with valid residency and bank accounts abroad, can import one car with a limited fee and relaxed regulations. To take advantage of this initiative, an Egyptian expat must pay 30 percent of the vehicle’s customs tax value, the total development fee, and total value added tax (VAT) through an interest-free certificate of deposit in foreign currency. After five years, this amount will be paid back in Egyptian pounds without interest, according to the exchange rate at that time.
New or used, the car, which can be imported over five years, should be a model between 2019 and 2024.
After several amendments to the initiative, its deadline was extended. Initially, the initiative was launched in October 2022 for a short, limited period of four months. However, following requests and pleas from Egyptians abroad, the deadline was extended to May 14, 2023.
To facilitate the process for those interested, a mobile application was launched on the App Store and Google Play. It allows users to apply to import a car from their country of residence, calculate fees, and track the process until the import approval is issued.
The government hopes to attract USD 2.5 billion through this initiative. At a time when the country is struggling with a shortage of foreign currency, the venture could be mutually beneficial for both the country’s economy and its citizens abroad.
Between 10 and 14 million Egyptians live abroad. Accordingly, Egypt is counted as one of the largest recipients of payments from abroad and the latter have greatly contributed to the country’s economy. In addition, remittances are a major source of hard currency.
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