Cypriot minister lashes out at ‘populist’ lawmakers

Cypriot Finance Minister Constantinos Petrides lashed out at lawmakers on Tuesday warning against “dangerous and unrestrained populism” after members snubbed a presidential veto on three crucial pieces of legislation.

The return of three bills vetoed by President Nicos Anastasiades was officially rejected by members of parliament on Tuesday, prompting the finance minister of the Republic of Cyprus to share on social media a letter from European officials who warned passed legislation was incompatible with EU laws.

“We had warned about this and the letter was put before the legislative body. And yet, carrying on with this dangerous and unrestrained populism, the House rejected the President’s bill referrals and put at risk the country’s reliability and the economy,” Petrides wrote on Twitter.

Anastasiades had refused to sign three bills, including a zero VAT rate on electricity supply and the abolishment of VAT in the supply of mineral oils. The controverisal bills were passed by the House on the same day when the tires on Petrides' official vehicle had been slashed in Nicosia, with police launching an investigation. 

In a letter sent to Cypriot finance ministry in mid-July, the director of Taxation and Customs Union in Brussels drew attention to the two bills saying their approval by the House was “problematic.”

“The VAT amending laws adopted last week by your national Parliament leads the Commission to express its concerns regarding the compatibility with the EU VAT legislation,” unit head Patrice Pillet wrote.

But Petrides was also referring to another legislation that was vetoed by Anastasiades, who refused to sign a bill suspending foreclosures until the end of October.

The foreclosure referral was rejected on Tuesday after 28 lawmakers voted to reject the presidential veto against 12 members, while the refusal the return of the two other bills was decided with 27 to 12 vote.

Last month Petrides warned that the bill was sending the wrong message by “protecting mainly strategic defaulters at the expense of depositors and consistent borrowers.”

“Without an effective instrument on foreclosures, there is a visible risk that the scheme will not be approved by the EU and, in any case, borrowers may again be reluctant to participate,” the finance minister had warned back in July.

Last week the Cypriot government filed with the European Commission an €85 million payment request under EU's Recovery and Resilience Plan.

But according to Kathimerini Cyprus, finance ministry director George Panteli, who was the recipient of Pillet’s letter last week, said failure to implement regulations regarding foreclosures was “complicating” the disbursement of the amount.