Finance Minister Makis Keravnos said the government is ready to accept "some increase in the tax-free threshold", after a meeting lasting almost two hours with representatives from the parliamentary parties DISY, DIKO, EDEK, and DIPA.
At the same time, Keravnos announced an increase in the income threshold for families with five children to €200,000 and the abolition of stamp duty.
According to the Finance Minister, "there was a great convergence of views and I expect that, within the margins accepted by the government, amendments will be submitted by the parties so that we can proceed with the tax reform".
"As a government, we are ready to accept some increase in the tax-free threshold. We have accepted and understood the issue of scaled subsidies in relation to the number of children and the increase in income criteria thresholds," Keravnos noted.
He added that, specifically regarding families with five or more children, "a high family income threshold of up to €200,000 has been accepted in order to provide relief to these families".
Regarding the simplification of procedures and excessive regulation, Keravnos said that "we have agreed to abolish stamp duty as well".
"The Ministry of Finance has identified the points on which it can agree, taking into account the need to maintain fiscal stability," he added.
In this context, he continued, "we have agreed that the parties will move to table amendments that will be precisely within these frameworks".
Both the Minister and the parliamentary party representatives referred to tomorrow's meeting of the Parliamentary Finance Committee for announcements regarding the details of the tax scales.
MP Christiana Erotokritou: Parties' suggestions will be submitted in the form of amendments
For her part, the Finance Committee Chair and DIKO MP Christiana Erotokritou welcomed "the fact that the Minister of Finance today listened positively to the suggestions" put before him and added that the suggestions came from both DIKO and other parties, such as DIPA, EDEK, and DISY.
She said that these suggestions will be submitted in the form of amendments tomorrow to the Finance Committee with the agreement and in consultation with the Ministry of Finance, and "will significantly increase tax-free income and reshape tax scales so that more taxpayers with low and middle incomes will be included in lower tax brackets".
She also said that the amendments will include "a significant increase in deductions for minor children, students, and for loan servicing and rent payments".
In response to a comment that, based on existing bills, 55% of workers are not taxed, and asked how much this percentage will now increase, Keravnos said that "we will be around 65%, maybe a little more".
Asked what limit public finances allow for increasing tax-free income, Keravnos said that what he can say and assure is that: "Nothing is accepted by the Ministry of Finance and nothing is promoted unless it is within the framework of the strict fiscal policy that we have been following and implementing to date."
Asked about the position of professional bodies on the protection of foreign investment, Erotokritou said that the Minister of Finance had taken into account the positions of all professional associations and added that the Finance Committee had given all interested parties the opportunity to express their views and argue their case.
She noted that, overall, the Cypriot economy would remain competitive in terms of foreign direct investment and foreign investment in general.
For his part, DISY MP Onoufrios Koulla, accompanied by MP Savia Orphanidou, said that yesterday's session of the Finance Committee had made it "quite clear that the amendments we want to make to the tax reform, as outlined by our party leader last week, are moving in the same direction as the Democratic Party, the Democratic Alignment (DIPA), and probably other fellow MPs on the Finance Committee."
He said that these amendments will be submitted tomorrow to the House Finance Committee.
"We fully understand that in order to achieve a positive outcome for our country, we need a majority in Parliament, as well as the consent of the Government and the Ministry of Finance," he added.
DIPA MP Alekos Tryfonides said that "there seems to be convergence" between the parties' amendments and the Minister of Finance.
He said that DIPA's proposals are aimed at helping low-income earners, the middle class, low-income pensioners, vulnerable groups, single parents, and generally supporting businesses.
(Source: CNA)
