Egypt plans to slash customs duties by 30% to support automotive and techs

The Egyptian government is currently preparing a major overhaul of its customs framework, proposing a 30% reduction in duties for production inputs in the automotive and electrical appliance sectors, Asharq Business reported on February 3. 

The finance ministry is expected to submit the draft amendments to the cabinet in February, with a parliamentary vote scheduled for March 2026.

The move, aimed at correcting tax distortions, seeks to lower local manufacturing costs and position Egypt as a competitive regional industrial hub, Asharq Business reported.

According to a government official, the plan involves cutting tariffs on 60 to 70 categories of industrial components. While duties on raw materials and intermediate goods are expected to drop from 10% to as low as 2% or 5%, the government simultaneously plans to hike tariffs on finished products, specifically those imported from China, to protect domestic manufacturers. The proposal includes introducing customs duties on imported electric vehicles (EVs) for the first time.

Egypt’s industrial sector is undergoing a massive transformation, with non-oil manufacturing surging by 14.5% y/y in Q1 of FY 2025/26; the strongest growth in over three years. Driven by record engineering exports and a strategic focus on high-tech and automotive hubs, the government is now aggressively cutting production costs to push industrial output toward a targeted EGP 2.9 trillion in 2026 ($61.5bn).

Sherif El-Sayad, Chairman of the Engineering Export Council (EECE), recently announced that engineering exports hit historic highs in 2025. Key highlights include electrical appliances ($1.46bn in exports) and electrical industries ($643mn in exports).