Green taxes are expected to be introduced in 2021, Finance Minister Harris Georgiades said on Thursday on the sidelines of the three-day Global Conference on Environmental Taxation, organised by the University of Technology (Tepak) in Limassol.
In his remarks, Georgiades said that the current trends in the economy are in the direction of environmentally friendly tax reforms, with the so-called Green Tax Reform substantially increasing taxation on energy-consuming products. On the other hand, it “attributes a corresponding reduction in taxation on employment, to contributions for example paid by workers and employers.”
Cyprus, he said, is moving towards that direction and announced that his ministry is working on a policy proposal, which will be launched for public consultation early next year so that it can be implemented by 2021.
The ministry of finance is in contact with the academic community also at European level in order to finalise this proposal, he said.
He explained that this was a “tax-neutral reform” meaning that the tax burden will not be increased overall, nor reduced.
“The reform does not mean taxation increase or reduction, it means change, redistribution among taxes,” the minister said.
In this case, he said, the reform is being implemented to achieve environmental goals that are binding for the country and “to boost competitiveness and job creation”.
“As the ministry of finance we are involved and we want to be aware of and keep in touch with trends and academic research on this issue,” Georgiades said.
During his speech, the minister said that although he is leaving his post in a few weeks, he is convinced of the successful outcome of this reform effort and assured that, personally, he will continue to offer his help and support.
Experts from around the world are participating in the conference on research on the impact of budgetary reforms (taxes, subsidies, emissions trading, etc.) on the environment and economic development.