Cyprus Mail

IPT collection falling short of targets

PROTRACTED discussions on the immovable property tax (IPT) bill is stopping people from paying and could derail revenue targets, the government said yesterday, as it urged MPs to resolve the matter immediately.

Inland revenue department director Giorgos Poufos told MPs that only €15 million had been collected, from the projected €140 million, ahead of the November 15 deadline

Parliament had approved the bill but the government later decided to exempt immovable property worth up to €5,000 at 1980s values from the new taxation.

That decision prompted political parties to table their own amendments, prompting people to postpone payment until the dust settled.

Parties have proposed exempting property worth up to €40,000, or the first €40,000. Poufos said the first exemption would cost the state around €20 million and more than double that amount if the first €40,000 was not taxed.

Exempting farming land would cost €24 million, Poufos said.

He also warned against extending the deadline by a month since many people would have a problem paying just before Christmas.

Poufos warned that the continuing discussion of the matter would eventually cause Cyprus to miss its targets, as they had been outlined in its bailout agreement.

He stressed that international lenders would also have to approve anything decided at the House Finance Committee.

Committee chairman Nicolas Papadopoulos said the matter must be resolved by Thursday, when the bill goes to the vote.

Opposition AKEL rejected suggestions that changes could not be made.

The party said it would insist in exempting properties worth up to €30,000 and raise the tax rate on the higher scales to compensate for the loss.

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