Mustafa Salem, the Deputy Chairman of the Planning and Budget Committee, revealed that Egypt's government arrears reached approximately 698 billion pounds by the end of the final accounts for the 2024-2025 fiscal year. Among these arrears, 398 billion pounds represent tax arrears, with disputes over approximately 328 billion pounds of this amount.
Salem pointed out that these figures raise questions about the effectiveness of digital transformation measures and the implementation of the "SAP" system and tax facilitation initiatives in reducing disputes and enhancing collection efficiency. He also questioned the evolution of the number of tax disputes before and after the implementation of these measures, calling for a detailed study of the reasons behind the persistence of these disputes.
Details of the Event
Salem reported that public revenues have shown significant improvement, with tax revenues reaching 2 trillion pounds, reflecting a growth rate of approximately 35% compared to the previous year. This improvement reflects the government's efforts to enhance collection efficiency and bolster the state's public resources without imposing new taxes.
He emphasized that these positive figures should be viewed alongside the need to review financial execution mechanisms and work to reduce the gap between planned allocations and actual expenditures, ensuring greater efficiency in managing public funds.
Background & Context
These statements came during a general session of the House of Representatives, chaired by Counselor Hisham Badawy, which was dedicated to discussing the final accounts for the fiscal year 2024/2025. The Deputy Chairman of the Planning and Budget Committee clarified that spending on the education sector recorded a growth of 20% compared to the previous fiscal year, reflecting the state's continued support for this vital sector.
He also noted that health sector allocations reached approximately 243 billion pounds, achieving a growth rate of nearly 22% from the previous year, indicating a clear trend towards enhancing health services and improving their quality.
Impact & Consequences
In a related context, Salem indicated that allocations for subsidies, grants, and social benefits reached approximately 345 billion pounds, with a growth rate estimated at around 13% compared to the previous fiscal year, confirming the state's continued support for vulnerable groups and expanding the social protection umbrella.
He stressed the importance of developing the financial planning system and oversight of execution to maximize the benefits from available resources to achieve economic and social development targets.
Regional Significance
These figures indicate the challenges faced by the Egyptian government in managing the public budget, as the accumulated losses for economic entities reached 251 billion pounds by the end of last June. Despite previous recommendations to reform the status of these entities, the situation remains unchanged, necessitating the government's vision for their reform.
Salem also discussed the need for optimal utilization of assets, noting that the government has identified more than 4,000 unutilized assets since 2018, which have yet to be leveraged. He emphasized the importance of reviewing tax and customs exemptions granted by the state and studying their economic impact.