in-cyprus 14 October 2022 - by gavriella
Some 81 providers of naturalization services are under investigation by the Tax Department Phileleftheros reported on Friday.
Investigations focus on the transactions the providers had with the investors and specifically check whether they had included VAT charges in their invoices.
The 81 providers under investigation are linked to 1,541 naturalization requests.
Members of the House Watchdog Committee had requested the checks after an Audit Office report showed that some providers were declaring fewer revenues than they were making.
The Tax Department said it has completed 49 checks out of a total of 81 providers, and imposed VAT charges amounting to €1.9 million.
Some investors were found abusing the reduced 5% VAT rule provided for people intending to use the house or apartment they purchased to reside permanently, as they were found not using the properties. As a result, they have been charged with additional taxes, Phileleftheros reported.
In total, the Audit Office concluded that the state lost €204 millions due to the abuse of the VAT discount by 1,298 investors, who bought mansions and luxurious apartments amounting to €1.6 billion but did not use them to reside permanently.
