Newsroom
The Cypriot government rolled out an eight-part support package Monday aimed at helping households, businesses, and farmers weather the economic impact of the ongoing war in the Middle East.
President Nikos Christodoulides announced measures that include cuts to electricity VAT, fuel taxes, and temporary zero taxes on essential foods, along with subsidies for hotel workers, farmers, and airlines. The goal, he said, is to ease living costs and strengthen the economy without jeopardizing fiscal stability.
“Economic stability is national security,” Christodoulides told reporters. “Responsible politics today ensures that every household and business can count on targeted support in times of crisis.”
Key measures include the following:
- Electricity VAT cut: Household electricity VAT will drop to 5% from May 1, 2026, through March 31, 2027.
- Fuel tax relief: Excise tax on motor fuels will be reduced by 8.33 cents per liter from April to June 2026, and the Green Tax on fuel will not be imposed.
- Food VAT adjustments: Meat, poultry, and fish will carry a zero VAT rate from April 1 through September 30, joining fruits and vegetables already taxed at zero.
- Tourism support: Hotels operating in April will receive a 30% wage subsidy for staff, while airlines will get targeted aid to maintain critical flight connections.
- Agricultural aid: Farmers will receive a 15% subsidy on fertilizers and agricultural supplies for April and May purchases.
The government says the new support measures have been carefully planned and budgeted, so they won’t strain public finances.
“The ongoing geopolitical upheaval requires a careful balance,” the President said. “We are acting decisively to protect citizens, businesses, and the economy while maintaining stability for the long term.”
Officials also highlighted stronger oversight to prevent profiteering, signaling that consumer protection will be strictly enforced as part of the package.
By combining tax relief, direct subsidies, and regulatory oversight, the government aims to soften the immediate economic impact of regional instability, ensuring that households feel the support in their daily lives, from filling their cars to keeping lights on at home.
