Nationalization and Taxation

In July on the ninth anniversary of the 1952 coup, Nasser announced a list of nationalizations that cut more deeply into the private sector than had occurred in any country outside of Eastern Europe. The decrees nationalized all private banks, all insurance companies, and fifty shipping companies and firms in heavy and basic industries. Eighty-three companies were obliged to sell 50 percent or more of their shares to public agencies. A second agrarian reform law lowered the limit for an individual owner from 200 to 100 feddans. The nationalization program continued in successive waves through 1962 and 1963 and involved shipping companies, cotton-ginning factories, cotton-exporting companies, pharmaceutical producers, ocean and river transport companies, trucking companies, glass factories, and the largest book-publishing company in Egypt. Between 1952 and 1966, £E7 billion in shared and public assets were transferred to public ownership.

The decrees also included legislation such as taxing gross incomes over £E5,000 at the rate of 90 percent, limiting base salaries of public sector directors to £E5,000, and limiting membership on all boards of directors to seven persons, two of whom must be workers. All joint-stock companies were required to place 5 percent of all profits in government bonds and to allot 10 percent to workers in cash and 15 percent to worker housing and community infrastructure. The work week was reduced to forty-two hours, and the minimum wage was raised. Half of all seats in Parliament and on all elective bodies and worker-management boards were reserved for peasants and workers.