VAT Assessment: Administrative & Legal Recourse

Since the introduction of Law No. 67 of 2016, Value Added Tax (VAT) has become the primary source of revenue—and disputes—for the Egyptian Tax Authority (ETA). Arbitrary assessments often stem from differences in the interpretation of "Deductible Inputs" or "Export Exemptions."

The Internal Committee Stage

Upon receiving a VAT assessment (Form 15), the taxpayer has 30 days to object. This objection is heard by an Internal Committee. Success at this stage requires a meticulously prepared "Tax Position" (Mawkif Dareeby) supported by primary invoices and banking records that align with the e-invoicing system mandates.

Appeal Committee (Lagna Al-Ta'on)

If the Internal Committee fails to reach a settlement, the case moves to the Appeal Committee, which is a quasi-judicial body. Its decisions are binding on the ETA but can be challenged by the taxpayer in the Administrative Court. Critically, filing a challenge in court does not automatically stay the obligation to pay the tax.

Practical Consequences

Delay in objecting to a Form 15 assessment results in the assessment becoming "Final and Due," allowing the ETA to initiate administrative seizure (Hagz Idary) of the company's bank accounts. Proactive legal representation is the only way to preserve liquidity during a tax audit.