Implementation of the 2025 state budget reached 59% for revenue and 52% for expenditure by end of September, according to the Treasury of the Republic of Cyprus.
More specifically, by the end of September 2025, revenue amounted to €6.91 billion, corresponding to 59% of the state budget (2024: €7.72 billion, 68%), while actual expenditures reached €6.75 billion, representing a implementation rate of 52%(2024: €7.94 billion, 58%).
According to the Treasury, the implementation of the state budget in terms of revenues shows a decrease compared to the same period last year, mainly due to a reduction in loan drawdowns by €1.06 billion, which is offset by increases in direct and indirect taxes by €0.15 billion and €0.14 billion, respectively.
Moreover, the implementation of the state budget regarding expenditure is also reduced, mainly due to lower repayments of loans and interest by €1.33 billion.
Revenue
According to the Treasury, during the period January–September 2025, indirect taxes increased by €0.14 billion (5%) compared with 2024, mainly due to the increase in VAT revenues by €0.07 billion (2025: €2.29 billion, 2024: €2.22 billion), revenues from other indirect taxes by €0.04 billion (2025: €0.41 billion, 2024: €0.37 billion), and revenues from excise duties by €0.03 billion (2025: €0.39 billion, 2024: €0.36 billion).
Direct taxes increased by €0.15 billion (5%) compared with 2024, mainly due to the increase in income tax from legal and natural persons by €0.12 billion (2025: €2.58 billion, 2024: €2.46 billion).
It is also noted that by the end of September 2025, loan drawdowns amounted to €0.04 billion (2024: €1.10 billion).
Expenditure
According to the Treasury, the implementation of payroll, pensions, and gratuities by the end of September shows a slight decrease of €0.01 billion, from €2.46 billion in 2024 to €2.45 billion in 2025.
Loan and interest repayments by the end of September amounted to €0.62 billion (2024: €1.96 billion), of which €0.48 billion (2024: €0.55 billion) concerned loan interest and charges, €0.07 billion (2024: €0.34 billion) the repayment of domestic loans, and €0.07 billion (2024: €1.06 billion) the repayment of external loans.
Expenditures on social benefits by the end of September reached €1.37 billion (2024: €1.33 billion). The increase of €0.04 billion (3%) is attributed mainly to higher healthcare benefits by €0.06 billion (2025: €0.61 billion, 2024: €0.55 billion), combined with a reduction in social welfare benefits by €0.03 billion (2025: €0.51 billion, 2024: €0.54 billion).
Additionally, transfers and subsidies by the end of September reached €1.31 billion (2024: €1.16 billion), marking an increase of €0.15 billion (13%) compared to the same period last year.
Operating and other expenses by the end of September amounted to €0.61 billion (2024: €0.67 billion), showing a decrease of €0.06 billion (9%).
According to the Treasury, over the last decade, the average implementation rate of total state budget expenditures by September has been 60%. The lower implementation rates in 2018 and 2025 are mainly due to the seasonality of public debt repayments. The implementation rate for 2025 stands at 52%.
As for development expenditures, the Treasury reports that capital expenditure implementation by the end of September reached €250.9 million, co-financed projects and other financing expenditures reached €132.5 million, grants, contributions, and subsidies by the end of September reached €160.1 million and the implementation of social benefits reached €40.5 million.
Over the past decade, the average implementation rate of the state development expenditure budget by the end of September stood at 36%. The implementation rate for 2025 is 39%, according to the Treasury.
(Source: CNA)
