All stakeholders — from businesses to MPs — have spoken in favour of fully abolishing stamp duty in Cyprus during a meeting of the Parliamentary Finance Committee. Experts stressed that eliminating this tax will increase transaction transparency, reduce administrative costs, and improve the investment climate, especially in real estate and corporate services.
Financial and legal organizations — including the Institute of Certified Public Accountants of Cyprus, the Cyprus Bar Association, representatives of insurance companies, banks, and business groups — stated that the government’s proposed legislation under the new tax reform does not abolish the old 1963 Stamp Duty Law but merely limits its application to four types of transactions.
Nevertheless, the discussion is increasingly moving toward a full repeal of this outdated tax, which no longer reflects the realities of 2025.
Where Stamp Duty Still Applies — and Why This Creates Tension
Under the proposed reform, stamp duty would continue to apply to:
- loan agreements
- real estate transactions
- lease agreements
- insurance policies with coverage above €10,000
The traditional scale of rates (0% to 2%) is expected to be replaced by a single rate of 2%. For real estate sale contracts, the duty will apply only to amounts above €50,000. The upper cap of €20,000 remains unchanged.
Economic experts note that while modernization of the law is a step in the right direction, it does not address the core issue: the need to abolish the very concept of stamp duty, which is widely considered an anachronism. Revising the existing law would reduce state revenues by about €10 million out of the current €38 million.
Political Position: Total Abolition Instead of Partial Reform
DISY MP Haris Georgiadis stated that the party will push for the complete elimination of stamp duty. According to him, this decision would reduce bureaucratic burdens for both individuals and companies and free the state from an inefficient, low-yield tax — generating only around €20 million a year.
Head of the Tax Department Sotiris Markides agreed that the entire concept of stamp duty is outdated, and that discussing paper stamps in 2025 is “absurd” in the age of digital services. He also noted that the transition to electronic document submission is being considered; however, a full abolition of stamp duty is not yet possible without assessing the financial compensation needed to offset lost revenue.
Social Aspect of the Reform: Expectations and Criticism
Alongside the stamp duty debate, MPs are calling for special attention to socially vulnerable groups. Representatives of DISY and AKEL stress the importance of:
- raising the tax-free threshold
- increasing support for families
- creating a more equitable tax system
They also remind the government that its pre-election promise to raise the tax-free threshold to €24,500 remains unfulfilled.
Critics argue that the proposed changes do not reduce social inequality — and may even worsen it. In their view, the reform should ensure fair redistribution of resources, with reducing the tax burden on businesses and families as a top priority. With ongoing digitalization of government services and expanded electronic reporting, the abolition of stamp duty in Cyprus appears both logical and modern. The debate continues, and more politicians and professional organizations agree that the future of Cyprus’s tax system lies in simplifying procedures and removing archaic charges.