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The Determinants of Customs Duties Evasion in Egypt

Author

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  • Barbary Mahmoud Magdy

    (Department of Finance, College of Business Administration in Hawtat bani Tamim, Prince Sattam bin Abdulaziz University, Saudi Arabia)

Abstract

Following the Arab Spring in 2011, Egypt implemented policies to restrict imports to control foreign currency spending, as foreign currency reserves dwindled. This decline was driven by reduced tourism revenues and remittances from Egyptians abroad. Among the measures Egypt adopted were floating the local currency, raising the customs exchange rate (used to calculate customs duties), and increasing tariff rates on numerous goods. These actions significantly raised the cost of imports, potentially incentivizing importers to evade customs duties. This study aims to explore the determinants of customs duties evasion in Egypt using a time series econometric model. Key variables analyzed include tariff rates, customs clearance efficiency, corruption, trade openness, and non-tariff barriers (NTBs). The analysis covers the period from 2001 to 2023. Regression analysis and econometric tests were conducted to validate the results. Findings suggest that customs clearance processes, tariff policies, corruption, trade openness, and NTBs significantly influence customs duties evasion in Egypt

Suggested Citation

  • Barbary Mahmoud Magdy, 2025. "The Determinants of Customs Duties Evasion in Egypt," Economics, Sciendo, vol. 13(1), pages 93-109.
    • Handle: RePEc:vrs:econom:v:13:y:2025:i:1:p:93-109:n:1001
    DOI: 10.2478/eoik-2025-0001
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    References listed on IDEAS

    as
    1. Allingham, Michael G. & Sandmo, Agnar, 1972. "Income tax evasion: a theoretical analysis," Journal of Public Economics, Elsevier, vol. 1(3-4), pages 323-338, November.
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    More about this item

    Keywords

    Customs duties evasion; Average tariff rate; Imports; Tax revenues;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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