Will new tax law save Egypt from budget deficit?

While the Egyptian government is confident that the new value added tax bill will not increase consumer prices, others say it is too early to tell.
Egyptian President Abdel Fattah al-Sisi (C) attends a meeting with Egypt's Prime Minister Sherif Ismail and members of the government's Economic Ministerial Committee to discuss future economic indicators and figures of the general budget and the results of the talks with the International Monetary Fund (IMF) at the Ittihadiya presidential palace in Cairo, Egypt July 27, 2016 in this handout picture courtesy of the Egyptian Presidency. The Egyptian Presidency/Handout via REUTERS ATTENTION EDITORS - THIS IMA
Egyptian President Abdel Fattah al-Sisi (C) attends a meeting with Egypt's Prime Minister Sherif Ismail (to left of Sisi) and members of the government's Economic Ministerial Committee to discuss the economy and state budget at the presidential palace in Cairo, July 27, 2016. - REUTERS
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Mohamed Saied
@MohamedSaiedF
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CAIRO — Egypt’s parliament is currently discussing the final version of the value added tax bill in preparation for its entry into force to supersede the general sales tax law of 1991. The government claims that this draft law will increase state revenues and curb the budget deficit, which has ranged between 11% and 13% over the past six years.

Egypt has been facing high inflation rates over the past several months due to the high rate of the US dollar against the Egyptian pound. The annual inflation rate jumped to 14% in June compared with 12.3% in May, the highest rate in seven years, according to data from the Central Agency for Public Mobilization and Statistics.

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