Cypriot Tax Amnesty Bill Approved

by Lorys Charalambous, for LawAndTax-News.com, Cyprus

27 July 2004

It emerged earlier this month that the Plenum of the Cypriot House of Represenatives has approved legislation designed to offer a partial amnesty to those disclosing previously undeclared bank accounts, in addition to a bill which will allow the Inland Revenue Department to access the bank accounts of those suspected of tax evasion.

Under the terms of the tax amnesty, those who declare their hidden assets in the three months following approval of the legislation will pay tax of 5%. After that period, and until the end of 2004, the tax rate on repatriated assets will be set at 6.5%. According to reports, the government hopes to secure the return of around CYP50 million.

Under the terms of the Elimination of Banking Confidentiality Bill, which is set to come into force early next year when the tax amnesty has run its course, in order to apply for access to or information on a suspected tax evader's bank account, the Inland Revenue must apply to a three member House committee or present its case to the Island's courts. Banks which fail to provide the necessary information will reportedly be penalised.

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