Filenews 18 October 2021- byFrixos Dalitis
Another tax is coming for Cypriot citizens in view of the green tax reform, which reaches the framework of the European Directive to reduce pollutants by 55%. The revenues from the new taxes will be returned to citizens in the form of compensatory measures. The main taxation of the green tax reform is the gradual introduction of the carbon tax for each year of the period 2022-2026 for all fuels used in the sectors of the economy that do not fall under the Greenhouse Gas Emission Allowance Trading Scheme (ETS).
This proposal affects non-ETS sectors, i.e. all sectors of the economy, except for power plants, cement and ceramics/brickworks. It is also expected that a water charge corresponding to the estimated cost of water scarcity and the environmental charge from the use of water supply water will be introduced, as well as the introduction of a single nationwide charge for ordinary household waste.
The above mentioned in a letter to the Parliamentary Committee on Foreign Affairs, the General Director of the Ministry of Finance George Pantelis. As Mr. Pantelis states in his letter, the fiscally neutral green tax reform is also an important reform within the framework of the Recovery and Resilience Plan, for which Cyprus has secured technical assistance from the European Union through the Technical Support Instrument (TSI) programme. It is expected to have a significant impact on the reduction of casting emissions and to contribute to the achievement of Cyprus' objectives in the new European Union strategy "FIT for 55".
"In the framework of the above study commissioned by the European Commission, best practices will be identified at EU level, an economic, environmental and social impact analysis will be carried out, a consultation will be conducted with stakeholders to discuss the economic, social and environmental issues arising from this reform and suggestions will be submitted to address the impact of the imposition of taxes/charges. The completion of the study is expected towards the end of 2022 and the relevant bills will be drawn up thereafter," the letter states,
The National Energy and Climate Plan for 2021-2030 sets out the national planning with objectives, targets, measures and policies and was submitted to the EU in January 2020, following the approval of the Council of Ministers on 15/1/2020.
