Memorandum of Understanding with the Government of Egypt
October 21, 2020
We all welcomed the news on October 15 that the Government of Egypt has published in the Official Gazette and put into full effect the Memorandum of Understanding (MoU) with The American University in Cairo of May 7, 2020, which Parliament approved and President El-Sisi signed in August. That MoU, which amended AUC's 1975 Protocol with the Government of Egypt, provides for AUC to offer 30 scholarships each year to graduates of Egyptian public schools and confirms the exemption of AUC employees' salaries and wages from local taxes to the extent that they are covered by non-local sources of funding. Because non-local sources of funding -- such as foreign students' tuition, the annual contribution from the endowment, and grants and gifts -- at this time do not fully cover AUC's payroll costs, this exemption is only partial. We have already begun discussions with the Tax Authority to determine precisely what the impact will be on the income tax obligations of AUC's employees. We will report details and begin withholding and remitting employees' income taxes to the Government in compliance with the law as soon as we reach a final agreement with the Tax Authority.