PROPHE Summary :
Sharp conflict has erupted between government and private universities in Egypt. The issue is government’s decision to place a tax of 20 percent on private university revenue. The claimed need is multi-fold: to offset a 20 percent increase in public sector salaries, incorporating private universities into an overall package of tax hikes, and an obligation for the universities to help what has been a supportive government. But private universities find the tax an unwarranted shock to what they claim are non-profit institutions, forcing them to hike tuition by at least the same percentage, jeopardizing enrollment in a competitive environment, especially as the 20 percent tax increase hits all of the 16 private universities, wealthy and poor alike.
For the full story, see University World News May 25, 2008 "Egypt:Private universities hit by revenue tax"by Ashraf Khaled http://www.universityworldnews.com/article.php?story=20080522124855467
PROPHE Observation:
The government-private clash is especially noteworthy considering that Egypt has been part of a Middle East story in which government itself was a key player in opening private universities. A key rationale, expanding access without equally expanding government expenditures, remains powerful. Yet the clash shows the vulnerability of private sectors where they do not have deep legitimate roots and where government is authoritarian. The outcome is uncertain as the government insists any university tuition increase must receive its authorization. Although the article lacks data on the private share of Egpyt’s enrollment, PROPHE has tentatively put the figure at roughly one-fifth, but more like 7 percent for universities. (The article refers mostly to “universities” but is not explicit about whether the new tax levies apply to all private higher education.)
