Egyptian army takes over security ahead of vote

The court was widely expected to dissolve the panel that drafted the constitution in a session scheduled for Dec. 2. The siege of the Nile-side building in Cairo’s Maadi district began Dec. 1.

In a surprise move, Mr. Morsi on Monday rescinded a series of decrees issued the previous day to raise taxes on a wide range of items and services, including alcohol, cigarettes, mobile phones, services offered by hotels and bank loans.

The state-owned daily Al-Ahram said the Sunday decrees to raise taxes were issued by Mr. Morsi. On Monday, the official MENA news agency carried a statement from Mr. Morsi’s office saying the president had decided to “suspend” the tax increases.

“The president does accept that citizens shoulder any additional burdens except by choice,” the statement said. Mr. Morsi, it added, has ordered a public debate on the increases to gauge popular reaction.

“The people will always have the loudest voice and final decision,” it added.

It was not immediately clear why Mr. Morsi changed his mind about the tax increases within a matter of hours, but the about-face appeared to have more to do with inexperience rather than a bid by the president to appear sympathetic with the majority of Egyptians who struggle daily to make end meet as the economy’s woes deepen. A popular backlash against tax increases could hurt the chances of the Morsi-backed draft constitution being ratified in the referendum.

Egypt and the International Monetary Fund last month reached an initial agreement for a $4.8 billion loan to revive the country’s ailing economy. The deal, agreed to after nearly three weeks of negotiations in Cairo, will support the government’s economic program for 22 months, the IMF said in a statement.

Egyptian authorities said at the time that it intended to raise revenues through tax reform, using the resources generated from new taxes to boost social spending and investment in new infrastructure.

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