Dr. Bahaa Helmy Writes: The Stamp Duty Problem in Investment

The Investor Services Center at the General Authority for Investment is one of the key elements in establishing companies and attracting investment in record time, compared with the obstacles and the shuttling between numerous different bodies that used to prevail before.

Indeed, a radical change has taken place in the outlook of those working at this center, marked by excellence in "awareness of the tasks and duties of the job / performance / organization / timeliness / general appearance and premises / courteous treatment / answering inquiries / providing assistance". This has been achieved by a group of young people qualified in various specializations, whom we regard as one of the fundamental guarantees for sustaining improved performance and innovation in managing the work in the future.

Bringing together representatives of the ministries, authorities and bodies concerned with investment and corporate affairs in a single place is an application of the one-stop-shop concept, and it is also one of the practical measures for combating corruption.

In reality, however, there remains an inherited stock of methods and means of obstructing people's business. Over the past few days, a strange problem whose cause is still unknown has arisen: the disappearance of the 10-piastre State Resources Development postage stamp from the investment post office and from almost all post offices in the capital. This has held up procedures for registering new companies and projects in the Commercial Register for periods of up to a week while people search for this stamp.

Looking into whether the stamp could be dispensed with by simply paying its value, it turns out that the law does not permit this. A stamp duty of one Egyptian pound must be affixed to every page of the copy of the memorandum of incorporation ("90 piastres ordinary stamp duty + 10 piastres State Resources Development stamp duty"), in application of the law and the decrees of the Minister of Finance, and this is self-evident.

But the disappearance of the stamp from post offices, creating new problems that undermine the investment system, is astonishing. It is unreasonable for an investor to take a taxi in search of the missing stamp on a wild goose chase that began at the investment post office and passed through the post offices of Emarat El-Obour, Abdou Pasha and Abbassia, then Ataba post office, in order to obtain fifteen State Resources Development stamps worth one and a half pounds.

The question arises as to which body is responsible for, or entrusted with, studying this problem and working to solve it. It certainly does not fall under the Ministry of Investment or the Investment Authority, yet it directly affects their work. Is it the Amiri Press, the Ministry of Finance, the post offices, or certain employees who trade in these stamps, especially since business owners are willing to obtain the State Resources Development stamp at any price to get their business done quickly?

We therefore put forward an idea to solve this problem: proposing an amendment to the Stamp Duty Law and its Executive Regulations while preserving the State's entitlements from this duty. This would consist of abolishing the system of stamp duty stamps, saving the costs of paper, gluing and printing and eliminating the possibility of forgery, and adopting an electronic stamp system instead, with its value collected as part of the prescribed fees and transferred directly to the accounts of the competent body through dedicated software.

The idea relies on printing copies of documents and contracts at the official bodies bearing a printed logo or mark indicating that the stamp duty has been paid, with the fee collected as part of service fees where applicable. Small printing machines could be supplied through companies affiliated with the Ministry of Finance, like those used to print receipts at banks, or in the form of small devices like those used for Fawry payments, in order to print a mark or symbol for the stamp duty on the photocopied pages required by the Commercial Register or any other body, following the practice used for paying electricity, telephone and other bills. In other words, the system of gummed stamp duty stamps would be replaced with environmentally friendly stamps, saving the cost of printing and circulating them, with the stamps printed through simple electronic means. This would solve the problem once and for all and eliminate attempts to forge stamps or traffic in them illegally, in addition to permanently eliminating one of the sources of inventive obstruction of people's business, that detestable legacy which can only be overcome through serious and meticulous follow-up and attention to evaluating work performance on an ongoing basis in all government bodies, bearing in mind the need to provide small change ("coins and banknotes") in sufficient quantities, or to issue cards of a set value that can also be used instead of small change, to ensure that one problem is not treated by creating another.