The Middle East and North Africa (MENA) region is going through a transition towards a system based on clean energy and a sustainable economy. In such context, countries of the region to plan and implement structural reforms to secure global climate objectives while ensuring economic growth and innovation in the region. Nevertheless, the political, economic and geographical circumstances vary in the states of the region, which can affect the way such reforms can be implemented. Among the most central elements of the transition towards a sustainable economy is the tax system.

This Policy Brief thus focuses on fiscal reforms in Egypt, a fossil energy producer. It provides insights on the state of play of environmental fiscal reform in Egypt and formulates recommendations on ways to make the environmental tax reform more impactful in terms of reduction of the level of emissions, incentivisation of the use and production of renewable energies, generation of sufficient fiscal revenues and stimulation of growth and innovation.