Belfast Telegraph

Friday 31 October 2014

Egypt raises taxes on luxury goods

Egyptian president Mohammed Morsi has raised import duties on luxury goods (AP)

Egypt has raised import duties on dozens of luxury goods as part of the government's efforts to increase revenues and revive the ailing economy.

Islamist president Mohammed Morsi said the decree on a wide range of "non-essentials" including shrimp, gambling tables, sunglasses, nuts, and fireworks.

Egypt's economy has been hit hard by the instability that followed the 2011 uprising that forced Hosni Mubarak from power, particularly the vital tourism sector.

The government is currently engaged in talks with the International Monetary Fund to secure a 4.8 billion dollar loan, which would help attract other international lenders and reassure foreign investors.

The conditions for the loan have not been made public, but Mr Morsi's government has been pushing an austerity plan that would cut subsidies and raise taxes to shrink the budget deficit from its current level of almost 11%. His government had initially aimed at 8.5% but is now suggesting it could be 9.5%.

Talks with the IMF were delayed in December when violent protests erupted and the president was forced to rescind his austerity plan. Some in the opposition and the business community have called for a national dialogue on the proposals to win public consent before any austerity measures are introduced.

Egypt had long been viewed as a stable corner of the Middle East. The past two years of political upheaval, however, have kept investors from returning and have curtailed tourism, a foreign currency earner.

One way Egypt is seeking funds is through the return of millions of dollars earned under rampant corruption during Mubarak's nearly three decade-long rule. Members of the president's Muslim Brotherhood group have spoken out in support of striking deals with former regime figures.

Latest News

Latest Sport

Latest Showbiz