The windfall tax proposal on Cypriot banks, introduced by Akel, aims to levy a 5% tax on banks’ unexpected profits to create a social solidarity fund for struggling borrowers, mirroring EU nation models. As discussions heat up, concerns over constitutionality and governance hesitations loom, with the debate showcasing the delicate balance between social welfare and financial stability in Cyprus.
The necessity for pension reform in politics is underscored by proposed measures such as a 90% tax on annual pensions over €70,000 and aligning retirement age with standard benchmarks. Despite public outcry over excessive payouts, legal battles have hampered reform efforts, leaving doubts about the possibility for substantial change in the system.
The state budget deficit in Cyprus surged to €980 million in 2023, a significant increase from the previous year. This rise was driven by higher expenditures surpassing revenues, with total expenses hitting €9.17 billion against revenues of €8.72 billion.
Cyprus plans to introduce green taxation by the end of 2024, incentivizing ecofriendly practices and levying high emissions to combat climate change. The upcoming elections in Cyprus on June 9 will shape the local governance landscape, with over 3,500 individuals participating, while the country strengthens international cooperation to combat illicit finance and corruption.
The introduction of carbon taxes in Cyprus aims to drive ecofriendly behavior but raises concerns over potential financial impacts, with lowincome households facing the most significant burden. Industry sectors express doubts on feasibility, with shortterm mitigation strategies like cashback schemes and subsidies in place to ease the transition.
