Important talks about changing Cyprus’s tax system have hit a wall. The main problem is the Akel party. They want to bring back a tax on people’s wealth. The Ministry of Finance does not agree. This makes it hard for the government to finish its big tax plan this year. A difficult vote will happen next Monday.
Akel has two ideas for new taxes. The first idea is a tax on expensive property. It would be a 1% tax each year on homes worth over €3 million. This kind of tax was stopped in 2017. Akel’s second idea is a yearly tax for companies. Companies with assets between €1 million and €2 million would pay between €350 and €1,250. This is to get money from rich companies.
However, the Ministry of Finance has said no to Akel’s ideas. They looked at the proposals before. They think they are not good. One big worry for the ministry is paying tax twice. They say a new property tax might be too similar to taxes already paid to cities. The ministry also has questions about Akel's property tax. They say the tax levels are not clear. They also don't understand why the €3 million limit was chosen.
The government is strongly against these ideas. Still, Akel wants to vote on its wealth tax proposals. This shows Akel is serious about its plan. It also shows a big difference in ideas between the government and Akel. This difference is about how to tax wealth fairly. The vote on Monday will be very important for Cyprus’s taxes.