President Nikos Christodoulides on Sunday renewed his call for members of parliament to pass into law his proposed reforms of Cyprus’ tax regime “as soon as possible” with a view to implementing the reforms from the start of next year.
“After so many years, the government has brought concrete proposals, and I hope, and I want to publicly make an appeal, that the discussions be completed as soon as possible so it can be implemented on January 1 for the benefit of the Cypriot people,” he said on the sidelines of an event in Kokkinotrimithia.
That call comes two weeks after six bills on the planned tax reform had been ratified by cabinet, with Christodoulides having at the time called for an “immediate” response from MPs.
“I hope that parliament will respond immediately and that the tax reform in its entirety will be implemented from January 1 … Now is the time for decisions. Now is the time for parliament to vote,” he said.
Later that day, Finance Minister Makis Keravnos echoed Christodoulides’ call for parliament to pass the bills as soon as possible, and said he was optimistic that implementing the reform by the beginning of next year is still possible.
“I hope that parliament and the parties will demonstrate the same focus on this issue, so that the entire package can be moved forward, discussed, and approved immediately,” he said.
Christodoulides had set out the plans in February, including raising the tax-free income threshold to €20,500 per year, an increase of €1,000 from its current level, at which it has sat since Cyprus introduced the euro in 2008.
Additionally, Cyprus’ 35 per cent top income tax rate would only apply to those earning more than €80,000 per year, rising from its current level of €60,001.
In addition to the €1,000 additional tax-free amount, parents will receive an extra €1,000 for every dependent, while Christodoulides’ plan also foresees €1,500 of tax-free income for every parent who is either buying their first house or renting, and €1,000 for a “green investment” on the part of every parent.
Single parents will receive double the ringfenced tax-free amount.
At the same time, he said corporation tax will increase from 12.5 per cent to 15 per cent, bringing Cyprus in line with European Union requirements.
Since then, those plans have been added to by new measures aimed at combating tax evasion, including plans to allow authorities to seal off businesses which repeatedly fail to issue receipts or invoices, criminalising the non-payment of income tax, and raising the fines levied at tax offenders.
