• Egypt launches Startup Charter targeting USD 5B in venture investment, supporting 5,000 startups and creating 500,000 direct and indirect jobs.
• Unified regulatory guide coordinates government financing, streamlines procedures, and introduces monitoring systems to improve policy implementation through data and startup feedback.
• Incentives include simplified taxes up to 1.5%, quarterly VAT filing, customs relief, and exemptions for qualifying startups with revenues below EGP 20M.

Startup Charter

Egypt’s Ministerial Group for Entrepreneurship announced the launch of Egypt’s Startup Charter. The “Startup Charter” was presented during the RiseUp Summit.

The charter was developed in cooperation with Entlaq and UN Women.

It was announced in the presence of Prime Minister Moustafa Madbouli, Minister of Planning, Economic Development and International Cooperation, and Chairperson of the Ministerial Group for Entrepreneurship, Dr. Rania Al-Mashat.

Objectives

One of the charter’s main objectives is to encourage venture capital activity and attract up to USD 5 billion in startup investment. This is through government resources, guarantees, and co-investments with venture capital funds and other private-sector investment and financing entities.

 Its other objectives include:

• Align government policies to effectively empower the startup ecosystem and support the growth of up to 5,000 startups. 
• Increase the economic impact of startups and contribute to the creation of approximately 500,000 direct and indirect jobs; 
• Support startups in expanding into international markets while strengthening local talent pipelines and reducing brain drain.

Guide for Startups

The startup charter is the first unified regulatory guide for startups in Egypt. It is a unified financing initiative aiming to coordinate available financing resources across government entities. As well as activating innovative mechanisms to maximize their impact by up to fourfold. 

The guide details the required documents, applicable fees, and issuance procedures. It will be formally adopted by the relevant authorities. It also details a dedicated channel provided to receive feedback and complaints and to address any challenges that may arise during implementation. In addition, the guide will be linked to monitoring, evaluation, and tracking systems to ensure continuous improvement of processes and their development based on data and feedback.

Alongside the charter, the Ministerial Group for Entrepreneurship aims to launch an observatory to monitor the implementation of entrepreneurship policies

Incentives and Faciliations

The charter is also launching an integrated package of facilitations and incentives. These incentives are provided to enterprises with a startup classification certfication which are subject to regulations.

These facilitations and incentives include: 

• Simplified tax system for startups (Ministry of Finance– Egyptian Tax Authority): any startup with revenues not exceeding EGP 20 million annually will receive new incentives, exemptions, and concessions, including a simplified income tax, ranging between 0.4% to 1.5% 4, based on annual business volume. 

•  Those joining the system will also be exempt from taxes on “capital gains resulting fromthe disposal of fixed assets, machinery, or producrtion equipment,” “dividends,” “stamp duty,” and registration and documentation fees, while also being exempt from the application of the discount system or advance payments. 
•  Submitting VAT returns every three months instead of every month, and the first tax inspection will take place after five years.
• Collection of a unified customs of 2% from companies that have obtained a classification certificate from the Ministry of Finance – Egyptian Customs Authority. 
• Startups will enjoy a partial exemption where a unified customs tax rate of 2% will apply to imported machinery and equipment necessary to the activity, as well as the advantage of paying customs tax due on imported production supplies, required for production processes, in installments over a 6-month period.