Economic Impact of Epidemics and Natural Disasters


The new law no. 170 of 2020 regarding the contribution towards the economic impact of epidemics and natural disasters (the “New Law”) was issued on 13 August 2020.

Article no.1 of the New Law provides that for the following twelve months, employers must deduct 1% from employees’ monthly net salaries, whether they work for the employer directly or under any other scope, and 0.5% from pensioners’ monthly net pension.


 Scope of application

The New Law imposes the contribution on the following sectors:

    • Public authorities such as ministries, government departments, and  other authorities that are covered by the state's general budget;
    • public economic authorities, agencies and authorities that have an independent budget;
    • public sector authorities and companies, public business sector companies, companies in which the state owns part of its share capital and banks;
    • cooperative sector;
    • private sector;
    • workers whose employment is regulated by special laws or special regulations;
    • chairman and board members of the mentioned authorities, organizations and companies; and
    • workers in special units, accounts and special funds affiliated with the mentioned entities.

Please note that the New Law applies to workers in permanent or temporary position, experts and workers in any other position or capacity. 



  • The New Law provides that the Prime Minister may exempt certain affected sectors from the contribution.
  • The New Law also exempts workers and pensioners who receive a monthly income of less than two thousand Egyptian pounds.



The New Law allocates such contribution to support the national economy given the impact of epidemics and natural disasters as follows:

  1. Allocating financial support for economic and production sectors, as well as affected entities and projects;
  2. providing grants to affected workers in the the economic and production sectors;
  3. providing grants to individuals and families, based on presidential decisions;
  4. contributing to medical research, public health, developing and maintaining health care; and
  5. any other sector that the Cabinet shall determine with a separate decision, after referral from the Minster of Finance.

Collection Mechanism

  1. The Ministry of Finance shall open a new bank account (the “Account”), which shall be related to the unified public treasury account;
  2. the competent authorities shall deposit the collected amounts into the Account; and
  3. specific representatives at the Ministry of Finance, the Accountability State Authority and the Egyptian Tax authority shall ascertain that all relevant entities have deposited the required percentage.


 It is worth noting that, the prime minister shall issue the relevant executive decrees.

We will follow-up on any development regarding the New Law and keep you informed.