Egypt launches second phase of e-invoice system

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Mon, 15 Feb 2021 - 01:52 GMT

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Mon, 15 Feb 2021 - 01:52 GMT

FILE - Minister of Finance Mohamed Maait

FILE - Minister of Finance Mohamed Maait

CAIRO – 15 February 2021: Egypt’s Minister of Finance, Mohamed Maait, announced the launch of the second phase of the electronic invoice system on Monday, February 15, with the participation of 347 companies registered with the Center for Large Funders, with the rest of the companies joining in succession until June 30, 2021, according to a statement from the Tax Authority.

 

The minister pointed out that the first phase of the electronic invoice system, which was launched on November 15, was successfully completed, stressing that this system is an important step on the road to digital transformation to achieve Egypt's vision 2030. 

 

“It enjoys great support from the political leadership, as it is a major step for the development of the tax system, and raising the efficiency of tax examination,” he added.

 

He explained that this contributes to the realization of the rights of the state treasury in a way that helps achieve financial and economic goals, and enables the state to complete its development path and improve the citizens' standard of living and the services provided to them.

 

Maait added that the Ministry of Finance and the Tax Authority provide all facilities and support to companies for the compulsory joining of companies to the electronic invoice system in its various stages, indicating that all legal measures have begun, including transfer to the prosecution against companies that are not obligated to join the system, in accordance with the provisions of the new unified tax procedures law.

 

For his part, Head of the Egyptian Tax Authority Reda Abdel Kader,  said that the electronic invoice system aims to establish a central system that enables the tax authority to follow up all commercial dealings between companies with each other, by exchanging data for all invoices instantly in a digital format.

 

He added that this system will help in the digital transformation of commercial transactions, dealing with the latest technical methods, and formally verifying the data of the source, recipient and contents of the invoice.

 

Abdel Kader emphasized that one of the basic conditions for joining the electronic invoice system for all stages is the issuance of the electronic signature certificate in order to enable the company to issue the invoices electronically before being approved by the system so that the buyer can deduct them in his monthly declaration, indicating that the electronic signature is considered a substitute for the live signature of the paper bill. .

 

He stressed that all companies that have taken a step from among the steps to join the system must complete the remaining steps in order to join the system.

 

The head of the tax authority called on companies to quickly take all necessary steps to join the electronic invoice system, as according to the provisions of Article 35 of the Unified Tax Procedures Law, companies and other legal persons are required to register their sales and purchases on the electronic system.

 

Article 37 of the same law also stipulates that every taxpayer or taxpayer is required to issue a tax invoice or receipt in electronic form, according to Reda Abdel Kader.

 

Abdul Kadir stated that joining the electronic invoice system brings many benefits to companies, including enhancing their tax positions by classifying them among companies with low tax risks, facilitating settlement procedures between companies with regard to value-added tax, and updating the method of exchanging invoices between companies.

 

He added that among these advantages are reducing the administrative burden, reducing the cost of transactions, gradually dispensing with paper-based archiving of invoices, simplifying corporate examination procedures with the possibility of “remote inspection”, facilitating “tax refund” procedures, the process of preparing and submitting returns, and ending traditional procedures with companies to fulfill the bills.

 

Abdul Qadir explained that as of July 1, 2021, joining the electronic invoice system will be a condition for companies to deal with ministries, economic authorities, public sector companies, the public business sector, and all offices and state interests, in accordance with the decision of the Council of Ministers.

 

He pointed out that the Cabinet's decision obligated all local administration units, service and economic public bodies, other public legal persons, public sector companies, public business sector companies, holding companies and their subsidiary companies to join the electronic invoice system that was established at the Tax Authority.

 

It also obligated it not to contract with any suppliers, contractors or service providers until after they are registered in the electronic invoice system, no later than the first of next July.

 

The decision also applies to companies in which the state and other public legal persons contribute to its capital by more than 50 percent that sell goods or services.

 

 

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