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Cyprus will maintain a zero value-added tax on certain basic goods until December 2026, the Finance Minister, Makis Keravnos, announced Wednesday following Cabinet approval of the measure.
The exemption, originally set to expire in December 2025, covers items including baby milk, diapers for infants and adults, feminine hygiene products, and fresh or chilled fruits and vegetables.
Speaking about the extension, Keravnos said, “This proposal concerns the extension of the zero value-added tax rate, which was set to expire in December 2025, with the goal of keeping it in effect until December 2026 for certain essential products.”
He highlighted the impact on households, stating, “Maintaining zero VAT on these products directly reduces the expenses of vulnerable households, increases their disposable income, and improves their standard of living.”
On the broader economic context, Keravnos added, “Although inflation is projected to be zero for 2025, the government believes the measure serves vulnerable groups, the vulnerable citizens of our country, and we want to keep it in place.”
The minister also addressed criticism from the Union of Municipalities regarding local authority funding, saying, “€27 million has been allocated for 2025, €15 million will be given in November for 2026, and another €12 million during 2026.”
“These are the amounts we, as a government, said we would provide and we will provide them,” Keravnos added. He emphasized the ministry’s openness to dialogue, noting, “The Ministry of Finance has never imposed a veto on serious, well-founded, and thoroughly developed opinions or proposals… what serves the public good is dialogue and good-faith understanding, not threats.”
