Commentators have given the thumbs-down to the coming changes to the tax regime – not so much for any major errors in it, but because it falls short of the government hype. Even a cursory analysis indicates that, for all the talk of achieving a fairer distribution of the tax burden, those on low incomes will see little to no benefit.
First, the government line: the so-called tax overhaul is billed as a ‘flagship project’, an ‘emblematic reform’ that will strengthen the middle class and low-income households and promote the growth of small and medium-sized enterprises, which represent more than 90 per cent of the Cypriot economy.
Finance Minister Makis Keravnos has said the tax reform “is characterised by its social aspect”, as it provides relief for families, students, young people, and large families.
Making his pitch, the minister stresses that 55 per cent of employees will not be taxed on their income.
Weighing in, government spokesman Konstantinos Letymbiotis this past week insisted that the changes are “no mere accounting exercise”.
It has been 22 years since the tax regime
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