On August 13th 2020, the Government of Egypt issued Law No. 170 for the year 2020. The law requires companies to deduct 1% from all its employees’ salaries for a period of 12 months starting from August 13, 2020. This requirement applies to those employed in both the private and public sector. Pensioners will see a reduction of 0.5% in their pensions for the same period. All proceeds will be contributed to the ‘Epidemics & Natural Disasters’ bank account at the Central Bank of Egypt to help support the effort of protecting the nation from the pandemic.
Main Points & Implementation:
- 1% is to be deducted from all net salaries for a period of 12 months and 0.5% from all pensions paid out to pensioners. The period of 12 months can be shortened or prolonged by the Egyptian Prime Minister.
- A decision by the Egyptian Prime Minister may fully or partially exempt those who are economically affected.
- This law does not apply to employees with a net salary of EGP 2,000 or less nor does it apply to pensioners who receive a monthly pension of EGP 2,000 or less.
- Employers & the Social Insurance Authorities are responsible for deducting the amounts and remitting them to the bank account specified by the Ministry of Finance (to be known once the Executive Regulations are published).
- The Egyptian Prime Minister shall issue the Executive Regulations of the law in the coming days, which will outline the detailed process in regards to the implementation of the law.
For further information or assistance regarding the application of Law No. 170, please contact the Director of our Cairo office, Mr. Beshir Noureldin at firstname.lastname@example.org.
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Director, Eurofast Egypt