The Cypriot government has introduced a tax reform plan aimed at modernizing the system and boosting the economy.
Key changes include raising the tax-free income threshold to €20,500 from €19,500 and applying the top income tax rate of 35% to those earning over €80,000, up from €60,001.
The reforms, set to take effect on January 1, 2026, also introduce targeted deductions, such as €1,000 per child for families earning under €80,000 and €1,500 for first-home mortgage payments or rental costs.
Corporate tax will increase from 12.5% to 15% to align with EU requirements.
However, AKEL has criticized the plan, stating it falls short of the President of the Republic’s pre-election commitment to comprehensive tax reform.
Haris Polykarpou, head of the party’s Economy Department, noted the absence of measures to broaden the tax base by addressing accumulated wealth and high incomes.
He also highlighted the lack of provisions to reduce the tax burden on the poorest citizens, emphasizing that a significant part of society will remain marginalized without substantial support.