Newsroom / CNA
Speaking at an Open Discussion Event organized by the G.R.M. Professional Training Center at the St. Raphael Resort in Limassol, under the theme “The Upcoming Tax Reform in Cyprus: Purpose, Guidelines, and Timelines,” the Minister announced that a comprehensive meeting is planned for early 2025. This meeting will provide updates on the project’s progress, present the results of each phase completed so far, and introduce the preliminary tax framework.
Mr. Keravnos highlighted that 22 years have passed since the last tax reform. “It is a political decision to sustain the momentum of our economy by maintaining fiscal discipline, pursuing balanced development policies, enriching our economic model, and implementing structural changes,” he stated. He further emphasized that the reform could yield significant benefits, enhancing the country’s sustainability and global competitiveness.
“This reform aims to make the tax system fairer, more efficient, and more competitive while strengthening the trust of citizens and businesses in the state,” he added. He underscored the need for tax policy to adapt to global economic changes and bolster Cyprus’s position as an attractive investment destination.
While recognizing the success of the current tax system—which has provided sufficient state revenue and offered targeted tax incentives for individuals and businesses—Mr. Keravnos noted the necessity for modernization and simplification. “This need reflects both international trends and the new economic environment, addressing longstanding demands from society and economic stakeholders,” he explained.
Outlining the core principles of the Tax Reform, Mr. Keravnos highlighted key objectives: simplifying the tax system, improving tax compliance, ensuring fair distribution of the tax burden, fostering a business-friendly environment, and digitizing tax processes.
To this end, the study for the new tax system has been assigned to the University of Cyprus’s Economic Research Center, which possesses the expertise to assess and quantify the economic impact of proposed changes. Mr. Keravnos also announced plans to collaborate with external experts from other European universities to further enrich the reform process.
The Minister noted that extensive public consultations with economic stakeholders have already been completed. More than 40 bilateral meetings were held with private sector representatives, associations, federations, employer unions, organizations, professional bodies, and political parties. Written submissions and opinions were solicited from these groups and from individual citizens. All feedback was documented and carefully evaluated.
Looking ahead, Mr. Keravnos revealed that another broad meeting is scheduled for early next year. This meeting will provide updates on the project’s progress, present phase-by-phase results, and introduce the preliminary tax framework for open discussion and feedback. “Engaging society in shaping the updated tax framework is crucial, and we are committed to ensuring full transparency throughout the process,” he affirmed.
In developing the modernized tax framework, the Republic’s commitments under the Recovery and Resilience Plan, along with its international and European obligations, have been carefully considered. Special attention has also been given to the rebranding of the country’s identity, aiming to maintain Cyprus as a welcoming destination for investors while effectively addressing tax evasion and avoidance.
