Egyptian Parliament approves 12% annual hike in cigarette prices
The Egyptian House of Representatives, in a general session on Sunday chaired by Speaker Hanafy Gebaly, approved a government-submitted draft law amending select provisions of the Value Added Tax Law (Law No. 67 of 2016). The amendment aims to strengthen state revenues and promote tax and social equity.
Under the new legislation, both the minimum and maximum retail price thresholds for cigarettes will increase by 12% annually over three years, starting on 5 November 2025. The rate of increase may be adjusted downward based on changes in production costs.
This measure is part of broader government efforts to expand the tax base and raise public revenues amid ongoing financial pressures.
Specifically, the amendments raise the maximum retail price for local cigarettes sold for less than EGP 38.88 to EGP 48. Cigarettes priced between EGP 38.88 and EGP 56.44 will now fall within a new range of EGP 48 to EGP 69. For imported cigarette brands previously priced up to EGP 56.44, the cap will also be raised to EGP 69.
These price thresholds are set to increase annually by 12% through 2028.
In addition, the law introduces a significant change to the taxation of alcoholic beverages, shifting from a percentage-based system to a fixed-rate structure. Taxes will now be levied based on alcohol content, with an annual increase of 15% for three consecutive years..
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