On Friday, December 3, the Parliament of Cyprus approved a bill to reduce electricity VAT from 19% to 9% for all individuals and companies for an indefinite period.
31 deputies voted for, 14 - against and only 1 abstained.
The initiator of the VAT reduction was the opposition AKEL party. It was supported by DIKO, EDEK and the Greens. In the Parliament of Cyprus, the legislative project was presented by AKEL Secretary General Stefanos Stefanou, DIKO leader Nicholas Papadopoulos and deputies from DIKO Christiana Erotokritou and Greens Kostis Efstathiou.
The adopted law will come into force retroactively - from November 1.
It is worth noting that the Government of Cyprus has previously opposed this proposal. Instead, the Finance Minister has developed two alternative proposals:
- The first one assumed a reduction in VAT from 19% to 5% for the poor for a period of 6 months.
- The second provided for a reduction in VAT from 19% to 9% for all residents of Cyprus for a period of 3 months.
In November, consumers in Cyprus got the highest electricity bills in the last nine years.
Opposition parties stated that the adopted bill is based on recommendations The European Commission "Solving the problem of rising energy prices: tools for action and support", which allow the government to support consumers during the energy crisis.
The reduction of VAT to 9% will be the third benefit for electricity in 2021. The first at the time was a 10% discount for all residents from September 2021 to February 2022, the second was a reduction in VAT for vulnerable groups of the population to 5% within six months.