Thursday, July 31, 2014

Egypt raises taxes on cigarettes & alcohol

Egypt raises taxes on cigarettes and alcohol

Sunday July 6, 2014

(Reuters) - Egypt raised the sales tax on cigarettes by up to 120 percent on Sunday and doubled the tax on alcohol as part of a series of measures to curb the budget deficit and reform the economy.

The decisions were taken by President Abdel Fattah al-Sisi and published in the state's official gazette, a day after a subsidy cut that increased the price of fuel and natural gas by over 70 percent, angering drivers.

Egypt is trying to reduce its deficit to 10 percent of gross domestic product in the next fiscal year, from an expected shortfall of 12 percent in 2013/14.

Sisi, who took office last month, has already raised the price of electricity and imposed a 10 percent tax on stock market gains.

Prime Minister Ibrahim Mehleb said the electricity move and the new cuts in fuel subsidies would save the government around 51 billion Egyptian pounds ($7.13 billion) this year. ($1 = 7.1501 Egyptian Pounds)

*Reporting by Yasmine Saleh and Ehab Farouk; Editing by Mark Trevelyan

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