Newsroom
Cyprus recorded a General Government fiscal surplus of €770.6 million in the first seven months of 2026, equivalent to 2.0% of GDP, according to preliminary figures released by the Statistical Service on Monday.
The surplus was €11 million higher than the €759.6 million recorded in the same period last year, although its share of GDP fell from 2.1% to 2.0%.
The improvement came as government revenue grew faster in absolute terms than expenditure. Revenue increased by €354.1 million, or 4.1%, reaching €8.91 billion, while total spending rose by €343.1 million, or 4.4%, to €8.14 billion.
Tax receipts drive revenue growth
Taxation provided a major contribution to the increase in state revenue.
Receipts from income and wealth taxes rose by €157.5 million, or 7.7%, to €2.19 billion. Social contributions also increased significantly, rising by €207.2 million, or 7.5%, to €2.98 billion.
Taxes on production and imports brought in €2.90 billion, an increase of €217.7 million, or 8.1%, compared with the first seven months of 2025.
VAT revenue was particularly strong. Net VAT receipts climbed by €259.5 million, or 14.7%, to €2.03 billion, from €1.77 billion a year earlier.
Not all revenue categories recorded gains. Capital transfers fell by €93.1 million to €19.6 million, while income from services declined by €45.1 million to €572.4 million. Interest and dividend receipts dropped by €33.3 million to €79.9 million, and current transfers fell by €56.8 million to €172.8 million.
Spending reaches €8.14 billion
Government expenditure increased by 4.4% during the January-July period.
Current spending accounted for most of the increase, rising by €384.3 million, or 5.4%, to €7.44 billion.
Social benefits rose by €165.2 million to €3.36 billion, while employee compensation increased by €74.8 million to €2.31 billion.
Spending on intermediate consumption recorded an 11.7% increase, reaching €873.3 million after rising by €91.5 million.
Interest payments increased by €15.8 million to €298.8 million, while current transfers rose by €45.8 million to €549.4 million.
Capital expenditure was one of the few major categories to fall, declining by €41.2 million, or 5.6%, to €698.8 million. Within this category, however, gross fixed capital formation increased by €10.7 million, or 2.1%, to €519.1 million.
Subsidies fell by €8.8 million, or 13.7%, to €55.6 million.
Social Insurance Fund posts largest surplus
The Social Insurance Fund accounted for most of the General Government surplus, recording a €775.1 million surplus in the first seven months of the year. This was up from €712 million in the same period of 2025.
Central Government, by contrast, recorded a €5 million deficit, compared with a €39.7 million surplus a year earlier.
Local Government recorded a marginal €0.5 million surplus, down from €7.9 million in January-July 2025.
The Statistical Service said estimates were used for several General Government entities within the Local Government subsector because the competent authorities had not provided sufficient data.
