Egypt Posts an EGP 187.9bn Primary Surplus in July and August as Tax Revenue Rises 23.8%
Egypt’s budget sector ran a primary surplus of EGP 187.9 billion in July and August, the first two months of fiscal 2026/27, as tax revenue rose 23.8% on the year.
For Egypt’s public finances, the year has opened with revenue rising 34.1% while spending rose 12.5%. The overall deficit narrowed to 1.3% of GDP from 1.7% a year earlier. In The Edge’s reading, tax is the better guide to the rest of the year, because the two-month ratios also include exceptional proceeds from the Alam El-Roum deal.
The figures come from the Ministry of Finance’s monthly financial report for October 2026, published on 29 October. They cover the budget sector, meaning the central administration, local government and public service authorities, on the cash basis of the IMF’s 2001 Government Finance Statistics standard.
Income tax and VAT carry the rise in tax revenue
Tax revenue reached EGP 436.8 billion, up from EGP 352.9 billion. Income tax did most of the work, rising 49.4% to EGP 130.1 billion. It supplied 51.3% of the increase.
Tax on corporate profits rose 52.8% to EGP 78.1 billion. Other companies paid EGP 54.4 billion, up 70.1%. Tax from the Suez Canal rose 23.8% to EGP 23.7 billion. Taxes on employment income rose 43.6% to EGP 34.8 billion.
Value-added tax and similar taxes brought in EGP 179.3 billion, up 22.1%. They remained the largest of the report’s five tax lines, at 41.1% of the total.
Property taxes rose 23.0% to EGP 97.7 billion. The tax on yields from Treasury bills and bonds made up 94.5% of that line. It rose 24.3% to EGP 92.3 billion.
The ministry attributes the rise to a better relationship with the business community and to the continuing gains from its first tax package, which it calls a permanent and continuing reform, particularly on income tax and on commercial and industrial activity. It points to the facilities given to small and medium companies, and to amendments to the value-added tax law that raised receipts on domestic goods and services.
Two lines moved the other way. Customs and other international trade taxes were 4.4% lower at EGP 24.7 billion. Other taxes came to EGP 4.9 billion against EGP 13.6 billion a year earlier, when the line was lifted mainly by capital proceeds transferred from the central bank, the report notes.
Tax revenue, July to August (in EGP millions)
| Tax | FY26 | FY27 | Change |
|---|---|---|---|
| Income | 87,062 | 130,061 | 49.4% |
| Corporate | 51,128 | 78,104 | 52.8% |
| Employment | 24,256 | 34,823 | 43.6% |
| VAT | 146,883 | 179,346 | 22.1% |
| Property | 79,470 | 97,749 | 23.0% |
| Customs | 25,890 | 24,747 | -4.4% |
| Other | 13,630 | 4,868 | -64.3% |
| Total | 352,940 | 436,771 | 23.8% |
FY26 and FY27 are July to August of fiscal 2025/26 and 2026/27. Corporate and employment taxes are part of income tax; VAT includes similar taxes on goods and services; customs includes other international trade taxes.
Non-tax revenue more than doubles with the Alam El-Roum proceeds
Non-tax revenue rose 115.2% to EGP 96.5 billion. Miscellaneous revenue reached EGP 55.0 billion, 3.1 times its level a year earlier.
The report attributes that rise mainly to exceptional proceeds from the Alam El-Roum deal, the Qatari Diar project on the Mediterranean coast set out here on 29 October.
Property income rose 91.5% to EGP 23.4 billion. Interest received made up EGP 15.3 billion of it, against EGP 4.3 billion a year earlier.
Tax still supplied 61.9% of the EGP 135.5 billion rise in total revenue. Its share of revenue was 81.9%, against 88.7% a year earlier, a gap that shows how much the non-tax lines added this time.
Spending outside interest rises 22%, led by investment and food support
Total spending rose 12.5% to EGP 849.1 billion. Interest, the largest item, rose 7.0% to EGP 512.2 billion. Its share of spending eased to 60.3% from 63.4%.
Domestic interest paid to non-government holders rose 8.8% to EGP 471.3 billion. Interest on foreign debt was 9.6% lower at EGP 40.2 billion.
Spending outside interest grew faster, by 22.0% to EGP 336.9 billion. Investment spending rose 84.8% to EGP 36.0 billion.
The ministry says Treasury-funded investment is returning to the levels seen before fiscal 2024/25, a year it describes as exceptional because of the slowdown that followed spending rationalisation. The ministry adds that fiscal policy keeps a ceiling on public investment of an estimated EGP 1.56 trillion in 2026/27, as the budget law sets.
Wages and compensation rose 9.8% to EGP 116.8 billion. Subsidies, grants and social benefits rose 14.8% to EGP 118.7 billion. The subsidies within that line rose 20.7% to EGP 61.7 billion.
Food subsidies, the support paid to the General Authority for Supply Commodities, doubled to EGP 25.6 billion from EGP 12.8 billion.
Interest equalled 96.1% of revenue in the two months, down from 120.4% a year earlier, so revenue now covers the interest bill in full. Revenue covered 62.8% of spending, against 52.7%.
Budget sector, July to August (in EGP millions)
| Item | FY26 | FY27 | Change |
|---|---|---|---|
| Revenue | 397,768 | 533,240 | 34.1% |
| Tax | 352,940 | 436,771 | 23.8% |
| Non-tax | 44,828 | 96,469 | 115.2% |
| Spending | 754,946 | 849,087 | 12.5% |
| Interest | 478,829 | 512,226 | 7.0% |
| Wages | 106,368 | 116,761 | 9.8% |
| Investment | 19,473 | 35,988 | 84.8% |
| Primary surplus | 113,736 | 187,899 | 65.2% |
FY26 and FY27 are July to August of fiscal 2025/26 and 2026/27. The overall deficit was 324,328 million pounds in FY27 against 365,093 million in FY26. Net acquisition of financial assets, the line between the cash and overall deficits, was 8,480 million against 7,914 million. The FY26 primary surplus is the overall deficit excluding interest payments, the report’s definition.
The deficit narrows to 1.3% of GDP against a 4.9% full-year target
The overall deficit came to EGP 324.3 billion, EGP 40.8 billion less than a year earlier. Measured against GDP, it narrowed to 1.3% from 1.7%.
The report reaches that figure from a cash deficit of EGP 315.8 billion. It adds the net acquisition of financial assets, EGP 8.5 billion against EGP 7.9 billion a year earlier.
The primary surplus widened to 0.8% of GDP from 0.5%. In pounds it rose 65.2% from EGP 113.7 billion.
The full-year budget for 2026/27 targets a deficit of 4.9% of GDP and a primary surplus of 5.0%. In 2024/25, the last full year in the report’s table, the deficit was 7.22% of GDP and the primary surplus 3.52%.
Two months make up 16.7% of the fiscal year. Spending has reached 16.4% of its full-year budget, close to that pace. Revenue has reached 13.1% and tax 12.4%.
The primary surplus has reached 15.4% of its EGP 1.22 trillion target. Interest has used 21.2% of its allocation, and investment 6.5% of its own.
The two-month ratios include the Alam El-Roum proceeds, the report notes, and it describes those proceeds as exceptional. The IMF mission now in Cairo is discussing the fiscal consolidation plan and revenue mobilisation, as set out here on 30 October.
Fiscal balance (in % of GDP)
| Balance | FY26 | FY27 | Budget |
|---|---|---|---|
| Overall | -1.7 | -1.3 | -4.9 |
| Primary | 0.5 | 0.8 | 5.0 |
FY26 and FY27 are July to August of fiscal 2025/26 and 2026/27; Budget is the full year 2026/27 under budget law No. 77 of 2026. The FY27 ratios include proceeds from the Alam El-Roum deal.
The first two months against the 2026/27 budget (budget in EGP millions)
| Item | Budget | Share |
|---|---|---|
| Revenue | 4,056,375 | 13.1% |
| Tax | 3,529,294 | 12.4% |
| Spending | 5,187,975 | 16.4% |
| Interest | 2,419,823 | 21.2% |
| Investment | 553,693 | 6.5% |
| Primary surplus | 1,217,181 | 15.4% |
Budget figures are from budget law No. 77 of 2026. Share is the July to August figure as a percentage of the full-year budget figure.
Figures are from the Ministry of Finance of Egypt’s Monthly Financial Report, October 2026 edition, sections 1 and 4, published on 29 October 2026; percentages, shares, differences and the FY26 primary surplus in pounds not attributed to the report are The Edge’s calculations.
Sources: Ministry of Finance of Egypt, The Edge.
