Newsroom
By the end of October 2025, Cyprus had collected 65% of its planned state revenues, while government spending reached just 59% of the budget, according to the General Accounting Office. Revenues totaled €7.63 billion, down from €8.48 billion at the same point last year, largely due to a sharp decline in loan draws. At the same time, expenditures amounted to €7.68 billion, compared with €8.77 billion in 2024.
The slowdown in revenue collection was partially offset by modest increases in both direct and indirect taxes. VAT, consumption taxes, and corporate and personal income taxes all showed slight gains, while borrowing fell dramatically, from €1.14 billion last year to just €90 million this year.
On the spending side, the government’s largest outlays, salaries, pensions, and gratuities, remained largely steady at €2.73 billion. Repayments on loans and interest dropped sharply to €820 million, down from €2 billion in 2024, reflecting the timing of debt payments. Social spending rose slightly to €1.51 billion, driven by contributions to renewable energy programs and modest increases in health benefits, while social welfare payouts dipped slightly.
Grants and transfers to municipalities, universities, and social programs rose 10% overall, with a notable boost to local governments and the Social Insurance Fund. Capital spending on infrastructure and public buildings reached €285 million, while co-financed projects and other targeted development programs accounted for another €153 million.
Over the past decade, the government typically spent about 65% of its budget by October, but this year’s lower 59% reflects both seasonal debt repayments and slower revenue flows. Development spending fared slightly better, with 46% of planned allocations executed by October, up from the 10-year average of 42%.
