Analyzing The Dynamic Relationship Between Foreign Direct Investment and Tax Revenues in Egypt / تحليل العلاقة الديناميكية بين الاستثمار الأجنبي المباشر والإيرادات الضريبية في مصر
Since 1974, Egypt has adopted several economic policies to attract FDI to finance investment needs and boost economic growth. This paper investigates the effect of FDI on tax revenue along with several other factors that affect tax revenue in Egypt, such as GDP growth, inflation, and gross capital f...
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معهد التخطيط القومى
2025
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| 在线阅读: | http://repository.inp.edu.eg//handle/123456789/6195 |
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| 总结: | Since 1974, Egypt has adopted several economic policies to attract FDI to finance investment needs and boost economic growth. This paper investigates the effect of FDI on tax revenue along with several other factors that affect tax revenue in Egypt, such as GDP growth, inflation, and gross capital formation, using annual data from 1975 to 2023. The findings reveal that FDI has a negative short-run but positive long-run effect on tax revenue. Despite the contradictory results in the short and long run, the negative impact of FDI on tax revenue in the short run could be explained by several causes, such as tax incentives offered by the Egyptian government throughout the study period to attract FDI, as well as profit shifting and repatriation. The results also indicate a negative effect of GDP growth on tax revenue in the short run. The findings further reveal that FDI has a negligible positive impact on tax revenue in the long run. Therefore, the study recommends reforming tax incentives, encouraging linkages between FDI and domestic firms, promoting reinvestment of profits, enhancing international tax cooperation, and diversifying sources of investment. |
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