Cyprus Rejects Harmful Tax Measure Claim

by Lorys Charalambous, Tax-News.com, Cyprus

30 July 2003

The Cypriot Finance Ministry has hit back at a recent Financial Times report which claimed that the European Commission has identified nine harmful tax breaks given to businesses in Cyprus.

Although the Cypriot government acknowledged that the nine areas of concern did exist, it stated this week that the measures in question have been abolished as part of recent taxation reform. A spokesman for the Finance Ministry told the Financial Mirror on Tuesday that the FT report was a "half-truth", and confirmed that "after the tax reform, we have no more harmful tax practices."

"In the second half of his article, the journalist referred to countries that resist changing their harmful practices and Cyprus is not referred to in the second part of his article," the Finance Ministry spokesman added.

In a report released last month, the European Commission revealed that all of the forthcoming members of the European Union - with the exception of Estonia and Latvia - have corporate tax measures in place which could disrupt the EU's internal market.

Whilst this report has yet to be brought into the public domain, Cyprus is thought not to be present on the list of those nations resistant to removal of harmful tax measures, according to the Financial Mirror.

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