Cyprus’ government recorded a €1.4 billion surplus for the January–September 2024 period, representing 4.2 per cent of GDP, according to preliminary data from the Cyprus Statistical Service.

This marks a more than doubling of the surplus from the same period in 2023, which stood at €679.9 million, equivalent to 2.2 per cent of GDP.

Revenue growth driven by taxes

Total government revenue rose by 6.8 per cent to €10.5 billion, largely due to increased income tax and VAT collections.

Specifically, revenue increased by €668.9 million compared to €9.85 billion for the same period in 2023.

Taxes on production and imports rose by €184.3 million, an increase of 5.6 per cent, reaching €3.45 billion, with net VAT revenue increasing by €150.9 million, a rise of 6.9 per cent, to €2.34 billion.

Revenue from income and wealth taxes saw a significant growth of €382.2 million, a rise of 16.4 per cent, amounting to €2.71 billion.

Additionally, income from interest and dividends increased by €21.9 million, a rise of 27.8 per cent, totalling €100.6 million.

Revenue from services grew by €145.3 million, an increase of 26.1 per cent, reaching €700.7 million.

Current transfers rose slightly by €0.9 million, totalling €248.1 million.

In contrast, capital transfers saw a decrease of €33.8 million, a dip of 29.6 per cent, dropping to €80.4 million.

Social contributions also declined, falling by €31.7 million, a drop of 1 per cent, to €3.23 billion.

Modest decrease in expenditure

Total government expenditure saw a slight reduction, totalling €9.1 billion, despite increases in social benefits and personnel compensation.

During January–September 2024, government expenditure decreased by €52.4 million, a drop of 0.6 per cent, compared to the same period in 2023.

Intermediate consumption costs rose by €66.9 million, an increase of 7.7 per cent, amounting to €937.4 million.

Personnel expenses, including imputed social contributions and pensions for public employees, increased by €190.8 million, a rise of 7.7 per cent, reaching €2.67 billion.

Social benefits rose by €302.9 million, an increase of 8.6 per cent, totalling €3.83 billion, while interest payments increased by €20.4 million, a rise of 6.5 per cent, to €334.9 million.

In contrast, subsidies decreased by €10.8 million, a drop of 8.9 per cent, to €110.7 million.

Current transfers dropped by €222.6 million, a decrease of 27.4 per cent, reaching €590.1 million.

The capital account fell by €400.1 million, a drop of 38.2 per cent, reaching €647.8 million, including a €44.4 million, equivalent to 7.8 per cent, decrease in fixed capital investments, which totalled €525.4 million.

Other capital transfers saw a sharp decline of €355.7 million, a drop of 74.4 per cent, to €122.4 million.

Finally, it should be noted that no estimates were provided for the local government sector due to insufficient data submission from relevant authorities.