Fearing de facto tax hike, lawyers strike to protest new digital billing system

Anticipating a de facto hike on tax contributions, several branches of the Lawyers Syndicate are to begin a partial strike today to protest a new digital billing system that a range of professionals are being newly obliged to use by the government. 

The syndicate’s general council announced on Tuesday that it formally rejects the new system, calling on all lawyers not to register for the system until a committee is formed by the syndicate and the Egyptian Tax Authority to review their objections.

The tax authority ordered in mid-November that individual enterprises — whether commercial, industrial, service-based or professional — as well as all self-employed people, must register for the new digital invoicing system by no later than December 15. 

To protest the new system, the syndicate branches of Port Said, Ismailia, Sohag and North Cairo have announced they will gather today at the main syndicate headquarters in Cairo and will abstain from working in court treasuries and prosecutors' offices.

Why are lawyers angry about the automated bills? Lawyers are currently required to pay a fixed sum in tax for each case they take on before a court, as well as a tax on their revenues at the end of the year. 

But under the new system, taxation will be calculated automatically by the authority based on the sum of invoices filed on the system. They will also be required to pay monthly VAT contributions, said Port Said Syndicate head, Safwat Abdel Hamid.

According to Abdel Hamid, who is on strike today, lawyers are also concerned that there are no clear measures in place for the automatic system to account for pro bono work, nor for legal cases assigned by the Public Prosecution for defendants without representation. 

Doctors, engineers, lawyers, artists, chartered accountants and consultants will also be required to use the digital invoicing system, with many of the syndicated professions expressing reservations about its consequences.

The head of the Lawyers Syndicate has met with Finance Ministry officials to discuss the situation, noting that decisions were taken to form a committee comprising the association, the ministry and the Tax Authority to review lawyers' problems. “no positive signs” have emerged yet regarding an agreement to alter the system for lawyers.