CONTINUEThis site uses cookies. By continuing to browse this site you are agreeing to our use of cookies. Find out more.
  1. Front Page
  2. News By Topic
  3. Cyprus Agrees Deficit-Busting Tax Measures

Cyprus Agrees Deficit-Busting Tax Measures

by Lorys Charalambous, Tax-News.com, Cyprus

07 December 2011


The Cypriot government has said there is multi-party consensus towards tax hikes and retrenchment to rapidly reduce the nation's deficit to below 3% of gross domestic product by 2012, to allay fears that the nation will require a bailout.

Having last month received a warning from the European Commissioner for Monetary Affairs, Olli Rehn that a credible plan is needed to consolidate the nation's budget, the government has announced that it has agreed with opposition parties various measures to stave off further credit-rating downgrades.

The government has received support for the introduction of a levy on private sector salaries and the freezing of public sector salaries for a two-year period. Additionally, value-added tax will rise to 17% from 15%, and the tax on dividends will increase to 20%.

If implemented, it is anticipated that the plan will slash the deficit from 7% of GDP recorded at the start of the year to 2.8% by 2012, down from the 4.9% 2012 deficit forecast in the absence of such measures.

TAGS: tax | investment | business | European Commission | value added tax (VAT) | sales tax | fiscal policy | public sector | banking | employees | budget | offshore | dividends | individual income tax | Europe

To see today's news, click here.

 















Tax-News Reviews

Cyprus Review

A review and forecast of Cyprus's international business, legal and investment climate.

Visit Cyprus Review »

Malta Review

A review and forecast of Malta's international business, legal and investment climate.

Visit Malta Review »

Jersey Review

A review and forecast of Jersey's international business, legal and investment climate.

Visit Jersey Review »

Budget Review

A review of the latest budget news and government financial statements from around the world.

Visit Budget Review »



Stay Updated

Please enter your email address to join the Tax-News.com mailing list. View previous newsletters.

By subscribing to our newsletter service, you agree to our Terms and Conditions and Privacy Policy.


To manage your mailing list preferences, please click here »