Tax Authority Research Department Letter on Comprehensive Medical Insurance Scheme

The above-mentioned letter has been issued to emphasize on the calculation of comprehensive medical insurance contribution as follows:

• The comprehensive medical insurance is applied on all individuals and corporations of any kind whichever their business nature is or their legal system.
• All entities are to contribute 0.25% of their gross annual revenue; however, it is a non-deductible cost for the corporate tax purposes. The calculation should be as follow:

Firstly, entities that keep regular books and records:

The contribution of the entity is estimated to be 0.25% of the entity’s total incurred revenue over the period from 12/7/2018 until 31/12/2018.

Secondly, entities that do not keep regular books and records:

The contribution of the entity is estimated to be 0.25% of the entities actual total revenue over the period from 12/7/2018 until 31/12/2018 as follows:

• Entities total revenue of the {year 2018) *(173/365 days)*0.25%}
• The Egyptian Tax Authority is responsible for the collection of these amounts.
• In case the entities do not pay the contribution amount, the General Authority for Comprehensive Medical Insurance may collect the amount through administrative seizure.
• Furthermore, Egyptian Government is currently discussing to put a ceiling for the contribution that may be applied; however, the ceiling amount is not yet determined.

Responsibility and Commitment:

Andersen Tax & Legal Egypt’s tax team has prepared this summarized report to illustrate the application of comprehensive medical insurance based on a recent official letter issued by the Tax Authority Research Department. Efforts have been combined to produce this report with clear and accurate content however this report aims only to spread general information and should not be treated as a legal document or a document that can be used for decision making, or for issuing specialized consultations. Please contact Andersen Tax & Legal Egypt for tailor-made solutions.