Cyprus Mail
Cyprus

MPs discuss scrapping business fee

All businesses have to pay the same amount

MPs on Tuesday called for the scrapping of the €350 annual fee for corporations, with the government saying it would consider the proposal and come back with its own suggestions.

The Elam party has tabled a legislative proposal abolishing the fee, which it says is an additional burden on small-sized and family businesses already struggling to make ends meet.

The majority of the parties support the idea.

The law mandating the annual €350 fee was enacted in 2011, with Cyprus’ international creditors later insisting that the levy be maintained.

Registrar of Companies and Official Receiver Spyros Kokkinos told the House commerce committee that since 2011 the state has collected around €293m from the fee.

The charge is the same for all companies, regardless of size or turnover, and must be paid all at once.

A finance ministry official said the government intends to review the levy, perhaps even abolish it as of 2019.

But this could not be done this year, as the government has already budgeted for the anticipated €45m in revenues. Moreover, announcing the imminent scrapping of the fee now would prompt many companies to avoid paying it in 2018.

Lawmakers said they would give the government some time to get back with its own proposal; if not, they would table the bill to the plenum.

Main opposition Akel said it had proposed back in 2012 that the fee be proportional to a company’s turnover.

Businesses making significant profits should contribute more to state coffers, party MP Costas Costa said.

The government is open to the idea, but before abolishing the fee it must find other means of making up for the lost revenues.

4 comments

Comments are closed.

X