Tax Reform Bills Submitted to Legal Service

The Department of Taxation is finalizing the amending bills for the tax reform, which are expected to be sent to the Legal Service next week for legal-technical review and will also be put out for public consultation.

According to reports, the aim is to submit the bills to Parliament after the summer recess. The bills amend four laws to incorporate the tax reform and are expected to be posted online for public consultation around July 9.

Key aspects of the bills include increasing the tax-free income for individuals to €20,500 and providing tax deductions for children, loans, and rents, under certain conditions. For companies, the corporate tax is increased to 15%, while the special defense contribution is reduced to 5%.

Regarding green taxation, discussions with the European Commission are ongoing for improvements. The Government aims to implement the tax reform by January 1, 2026.

The 2026 state budget is in the initial stages of preparation, with Ministries having submitted their budgets to the Ministry of Finance.

Source: CYPRUS NEWS AGENCY