Egypt's Tax Authority Collects LE 14 Billion via Advanced Risk-Assessment System

The Egyptian Tax Authority (ETA) has successfully collected approximately LE 14 billion through its innovative tax risk-assessment system, according to Rasha Abdel-Aal, the Head of the ETA. This system has also facilitated around 750,000 voluntary disclosures, contributing to a substantial total tax yield of LE 97 billion. Abdel-Aal shared these insights during a seminar hosted by the Journalists Syndicate, highlighting the ETA's strategic shift towards a more balanced operational philosophy.

The authority is now focusing on achieving a equilibrium between augmenting public treasury resources, protecting the interests of the business community, and simplifying tax system interactions. The tax risk-assessment system is a central component of the ETA's ongoing development and digital transformation initiatives, aimed at modernizing tax administration and improving collection efficiency.

This sophisticated system employs big data analytics and artificial intelligence to electronically scrutinize taxpayer files. It categorizes these files based on their tax compliance levels without human intervention, marking a significant departure from the previous practice of random, comprehensive audits. The system's functionality relies on network connectivity and data integration, linking the ETA's databases, including e-invoicing and e-receipt systems, with those of other government bodies such as the Customs Authority, the Commercial Register, banks, and investment authorities.

By comparing the transaction volumes reported by companies and individuals against their tax returns, the system automatically identifies unexplained discrepancies that might indicate tax evasion or undeclared business activities. Consequently, field inspection and tax audit teams are now directed exclusively towards high-risk files, proving highly effective in detecting non-compliance and ensuring the timely collection of state revenues. This approach also benefits compliant taxpayers by exempting them from unnecessary audits, thereby fostering a stable and equitable business environment.

These efforts are complemented by tax facilitations introduced by the Finance Ministry and the Tax Authority to build trust with the business community. The goal is to encourage taxpayers, including those in the informal sector, to voluntarily regularize their tax status and file returns to benefit from these incentives. This initiative also aims to integrate the informal economy into the formal system, promoting tax equity and strengthening the national economy.