Extensive tax reform planned in Cyprus

Cyprus is rolling retired the biggest tax shake-up successful implicit 20 years, promising a fairer system that supports families, strengthens section businesses, and keeps the system competitive.

According to President Nikos Christodoulides, the betterment plan, approved by the Council of Ministers and present headed to Parliament for a vote, is being billed arsenic 1 of the astir important structural changes since Cyprus joined the EU. It aims to marque taxes simpler, fairer, and amended aligned with today’s economical reality, while staying fiscally neutral so it doesn’t stroke a spread successful nationalist finances.

Government officials accidental the caller framework, based connected a elaborate study by the University of Cyprus’ Center for Economic Research, promotes κοινωνικά cohesion and economical maturation while ensuring Cyprus remains an charismatic spot to work and invest.

For the archetypal clip successful 20 years, the tax-free threshold for each individuals will emergence by 1,000 euros to €20,500 and could transcend €24,500 depending connected household circumstances and eligible deductions. The caller tax structure besides tackles what the authorities calls “distortions” that antecedently favored large, foreign-owned firms. 

The firm tax complaint will beryllium acceptable astatine 15%, successful enactment with planetary standards. Meanwhile, the tax connected existent dividends will beryllium chopped from 17% to 5%, encouraging companies to reinvest profits successful productive ventures alternatively than determination them abroad.

Cypriot-owned companies stand to payment most, with the authorities saying the changes will “correct a existent imbalance” and springiness section entrepreneurs a fairer footing.

To beforehand innovation, businesses will present get an enhanced 120% tax deduction connected probe and improvement spending, and for the archetypal time, individuals will besides person tax breaks for greenish investments.

The program besides aims to trim bureaucracy, reducing stamp work to indispensable transactions, allowing losses to transportation guardant for 7 years alternatively of five, and updating special tax regimes and superior gains exemptions. 

Officials accidental these steps will boost transparency and predictability, cardinal to attracting investors who want a stable situation to program long-term. 

The authorities argues that the timing for betterment is right. Cyprus is projected by some the EU and the IMF to stay 1 of Europe’s fastest-growing economies, with 1 of the lowest ostentation rates.