Real Es­tate De­vel­op­ment Cham­ber re­ceives com­plaints on ap­ply­ing VAT on ad­min­is­tra­tive, com­mer­cial projects in vi­o­la­tion of law

The Daily News Egypt - - Business | Real Estate -

The Real Es­tate De­vel­op­ment Cham­ber of the Federation of Egyp­tian In­dus­tries (FEI) re­ceived a large num­ber of com­plaints from real es­tate com­pa­nies af­ter the Egyp­tian Tax Author­ity an­nounced the ap­pli­ca­tion of the value added tax (VAT) on the rented ad­min­is­tra­tive and com­mer­cial units within the projects de­vel­oped by com­pa­nies in vi­o­la­tion of the law.

Head of the cham­ber,Tarek Shoukry, said that ap­ply­ingVAT on rented ad­min­is­tra­tive and com­mer­cial units vi­o­lates the law that ex­empts these units from tax.

Shoukry pointed out that this ac­tion strongly af­fects in­vest­ment in these ac­tiv­i­ties,as com­pa­nies carry new bur­dens added to the prob­lems they face since the lib­er­al­i­sa­tion of the ex­change rate of the pound and the high price of con­struc­tion raw ma­te­ri­als, as well as rais­ing in­ter­est rates and other eco­nomic re­form de­ci­sions.

Shoukry pointed out that the ad­min­is­tra­tive and com­mer­cial ac­tiv­i­ties have been pro­moted re­cently both at the level of de­vel­op­ers or cus­tomers. Fur­ther­more, a large amount of money was pumped in these ac­tiv­i­ties, but such ac­tion causes the re­luc­tance of com­pa­nies to in­ject new in­vest­ments in ad­min­is­tra­tive and com­mer­cial projects.

He noted that the cham­ber’s board of di­rec­tors is hold­ing a se­ries of meet­ings dur­ing the com­ing pe­riod to pre­pare a me­moran­dum on the reper­cus­sions of im­ple­ment­ing the de­ci­sion on the ac­tiv­ity of the sec­tor and to sub­mit it to the con­cerned au­thor­i­ties to en­sure com­pli­ance by the tax author­ity with the law.

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