Cyprus: €70 million in measures to ease the cost of living

Cyprus’s Council of Ministers yesterday approved seven Finance Ministry proposals worth €70 million aimed at tackling inflation and the high cost of living.

The measures include electricity subsidies, zero VAT on essential goods, a lower tax on heating oil, reduced VAT on solar panels and a one-off €200 payment to vulnerable groups. They bring the total cost of measures currently in effect to around €160 million.

According to Phileleftheros, the measures are:

1. Electricity: Subsidies for vulnerable consumers (category 08) and commercial users (category 10) are extended throughout 2027. Some 23,300 households will receive full coverage of the increase, while around 82,500 businesses will receive subsidies of up to 85%.
2. Zero VAT on essential goods: Zero VAT on fresh fruit, vegetables, milk, baby nappies, adult nappies and feminine hygiene products will remain in place throughout 2027.
3. Zero VAT on meat, fish and poultry: The measure is extended and expanded to include bread, dairy products, coffee, sugar and baby food. It will apply from October 12, 2026, to May 31, 2027.
4. Heating oil: Excise duty will be cut from 7.4 to 2.1 cents per litre from November 1, 2026, to April 30, 2027.
5. Solar panels: VAT for residential consumers will be cut from 19% to 9%, effective immediately.
6. One-off €200 payment: The payment will be made to 53,511 vulnerable beneficiaries.
7. Mountainous areas: The allowance will be increased for 10,500 households and 24,000 beneficiaries, with an additional €50 per household depending on altitude and €35 per person.

Finance Minister Makis Keravnos said the ability to introduce additional measures “stems precisely from the implementation of an economic policy that creates budget surpluses and reduces public debt,” adding that “these surpluses are passed on in this tangible way to society and our fellow citizens.”

Source: Fileleftheros