Egypt cuts VAT to 5% on production machinery and medical devices

What changed in detail

Law No. 149 of 2026, amending the VAT Law issued by Law No. 67 of 2016, was published in Egypt’s Official Gazette, issue No. 30 bis (a), on 28 July 2026 and applies from the following day. It substitutes the first paragraph of Article 3 of the VAT Law: the general rate on goods and services stays at 14%, but by way of exception the rate on machinery, equipment and medical devices used in producing a good or rendering a service is 5%, excluding buses and passenger cars. Devices used for medical purposes are treated as medical devices for the purposes of that exception. The Law also substitutes the fourth paragraph of Article 5, Article 28 bis, and item 3 of the first paragraph of Article 30.

This record supersedes an earlier report of the same relief as a House of Representatives approval; the House vote has now been enacted and gazetted, with the exception scoped to production-use machinery and equipment rather than “medical equipment” alone.

What it means

The 5% rate is capital-equipment relief, not a medical-sector carve-out — it reaches any machinery or equipment used in production, with medical devices as one named category inside that broader class. Buses and passenger cars are explicitly carved back out. Suppliers importing or selling production machinery into Egypt should re-check rate tables from 29 July 2026 rather than waiting for medical-specific guidance.