IMF disappointed with Egypt’s postponement of capital gain tax: Bloomberg

The IMF voiced its disappointment with Egypt’s decision to delay the enforcement of a capital gains tax, saying it was fair and raised needed revenue, reported Bloomberg on Sunday.
The decision means that “more of the cost of reducing the budget deficit will now be paid by people who are less able to afford it,” Chris Jarvis, the lender’s Egypt Mission Chief told the news agency in an e-mail.

The ten percent tax on investors' gains in the bourse had been introduced by the government in July 2014 as part of its efforts to overhaul an economy battered by years of political turmoil.

The move was part of a spate of new taxes on income, consumer goods, and real estate geared to bolster state revenues and cut the budget deficit from 12.8 percent of GDP to 11 percent this year.

The main index of the Egyptian stock exchange saw its sharpest rise in two years last week, when the delay was announced, driven by domestic institutions' purchases.

The tax comprised of a capital gains component and a stock dividends duty.