President Abdel Fattah El-Sisi issued Law No. 3 of 2026 amending some provisions of the Real Estate Tax Law. The law exempts a family’s primary residence from the tax up to an annual rental value of 100,000 Egyptian pounds (about $1,850), with any value exceeding this threshold remaining taxable.
A study issued by the Built Environment Observatory in early March said the tax would in practice apply to units priced above 8 million pounds (nearly $150,000), a level above average property prices in most Cairo neighborhoods. The threshold is roughly in line with the average in Dokki, Sheikh Zayed, and New Cairo, and below average only in Zamalek, suggesting the amendments leave most residents exempt while concentrating the burden on wealthier owners. These findings were based on average property prices listed on search engines.
The House of Representatives approved the government-drafted bill earlier this week after a wave of parliamentary criticism of the government’s original proposal, which had set the exemption threshold at only 4 million pounds (roughly $75,000). According to the Built Environment Observatory, the government’s initial proposal would have concentrated exemptions in middle-income and working-class neighborhoods before the threshold was raised to its current level.
The law, published in the Official Gazette on Monday, also allows the Cabinet to raise the exemption threshold in the future in line with economic and social changes.
It provides a 25% discount on annual tax due for residential properties used for purposes, and 10% for nonresidential properties, if the tax return is filed on time, with an additional discount of up to 5% for early payment.
Taxpayers are permitted to settle tax disputes pending before courts or appeals tribunals by paying 70% of the total disputed tax, fully clearing their liability. The law further exempts taxpayers from late-payment charges if they pay taxes due within six months of its taking effect, while stipulating that such charges may not exceed the original tax debt principal.
The law also sets out cases in which the tax can be lifted, including when a property collapses, is damaged in whole or in part, or becomes unusable because of force majeure. Tax debt may also be written off in cases of death with no apparent estate, bankruptcy, or leaving the country for 10 years without assets that can be seized.
The observatory noted that the exemption applies to only one housing unit used by a family as its primary residence, meaning about one-third of Egypt’s properties would still be subject to the tax, according to its estimates.
Beyond the debate over exemption thresholds, the observatory warned of weak real estate tax collection efficiency, saying collections over the past 13 years did not exceed 77% of the Finance Ministry’s target.
In fiscal year 2024-2025, the ministry targeted 7.9 billion pounds (roughly $146 million) in real estate tax revenue but actually collected only 6.3 billion pounds (about $116 million). It is aiming to raise that to 18 billion pounds (around $333 million) in the current fiscal year.
The Built Environment Observatory said the incentives included in the amendments were meant to encourage compliance, but expressed doubt they would be enough on their own to deliver the revenue levels the government expects.
