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The Egyptian Tax Authority (ETA) has clarified that tax accounting for e-commerce activities follows the exact same regulatory principles applied to traditional brick-and-mortar businesses.

According to the provisions of the Income Tax Law No. 91 of 2005 and its subsequent amendments, e-commerce businesses maintaining regular books and accounts are taxed based on actual revenues and expenses to determine their net taxable profit.

Presumptive Taxation vs. Regular Bookkeeping

The authority noted that in cases where businesses fail to maintain regular financial books and accounts, their tax liability is calculated via a presumptive (estimated) assessment. This process is guided by the ETA's official executive instructions concerning standard net profit percentages across different commercial activities.

For sole proprietorships, the authority defined the requirements for maintaining regular books as follows:

Purchases and Expenses Ledger: A documented record tracking all operational costs and supply acquisitions.

Revenues and Sales Ledger: A documented record tracking all incoming commercial transactions.

The ETA emphasized that all data entered into these ledgers must be fully backed by verifying documentation, specifically electronic invoices issued through the state's official E-Invoice System.

Digital Ledger Alternatives

Furthermore, the tax authority confirmed that digital accounting systems and electronic records are fully recognized as valid alternatives to physical, paper-based ledgers. However, this acceptance is strictly conditional upon the business retaining all original purchase and sales invoices.

To support merchants navigating these compliance frameworks, the authority invited taxpayers to visit the headquarters of its specialized E-Commerce Unit or reach out via email at [email protected]. Inquiries can also be directed to the Egyptian Tax Authority’s official hotline at 16395.