Ashraf Abdel Ghani, tax accountant and founder of the
association, explained that outsourcing is a business strategy in which a
company contracts an external party to perform tasks or provide services
previously handled internally. This approach aims to reduce costs, increase
efficiency, focus on core activities, and leverage specialized expertise.
Outsourcing covers fields such as information technology, human resources,
accounting, and technical support services.
Abdel Ghani emphasized that Egypt’s outsourcing industry is
witnessing unprecedented growth, achieving an average annual growth rate of 16%
over the past five years, making it one of the fastest-growing sectors in the
national economy.
He noted that the number of outsourcing centers in Egypt
increased by 24.4%, while the number of companies operating in the sector rose
by 25%, reaching 186 local and international firms with 206 service export
centers. The sector’s revenue rose to $4.8 billion, generating 170,000 job
opportunities.
Abdel Ghani added that Egypt now ranks third globally in the
outsourcing industry, thanks to its human capital and young workforce
possessing technical, digital, and language skills, lower labor costs compared
to other countries, and a well-developed infrastructure supporting the sector.
He highlighted that Egypt’s Vision 2030 aims to increase
outsourcing exports to $15 billion and provide 550,000 direct job opportunities
for young people.
Abdel Ghani explained that the Minister of Finance issued
Decree No. 515 of 2025, establishing accounting principles for taxing labor
supply services provided by outsourcing companies. Under the decree,
Value-Added Tax (VAT) will be calculated based on the invoiced amounts after
deducting operational expenses such as wages, insurance, and medical treatment,
rather than on the total invoice. This measure alleviates the burden on
outsourcing companies and promotes tax fairness.
He described the decision as a step to revitalize the
outsourcing sector, which requires simplified procedures and flexible tax policies,
particularly for startups that face outdated laws affecting shareholder
agreements, operating licenses, or dispute resolution mechanisms.
Abdel Ghani also called for the establishment of special
zones for outsourcing companies and for accessible financing for small and
medium-sized enterprises (SMEs), which represent more than 30% of the
outsourcing industry.