The generous tax breaks dangled to repatriate ‘talent’ from the Cypriot diaspora concern not only Cypriots but also citizens of other EU countries as well as of non-EU countries, MPs heard with some surprise on Monday.

Answering lawmakers’ queries, a finance ministry official said the proposed tax incentives extend to non-Cypriots. This momentarily threw MPs off, as the public relations campaign – launched by none other than President Nikos Christodoulides in London last week – was targeted at Cypriot expats which the government wants to lure back to the island.

Under the current incentives scheme, a tax exemption of 20 per cent on earnings applies, or up to €8,500 – whichever is smaller – for persons who have worked overseas for three consecutive years prior to being employed in Cyprus.

The tax exemption is valid for seven tax years.

In the scheme now being revised, the exemption rises to 25 per cent, and the maximum exemption amount goes from €8,550 up to €25,000. It also modifies the time spent working abroad, so that the current three-year requirement becomes 36 months of employment during the past five years.

In addition, the time interceding from the end of a person’s studies to their return to Cyprus is reduced from 15 currently to seven years.

Also, the incentives framework will be reevaluated every five years, making necessary adjustments to prevailing financial and market conditions.

Getting a first glimpse at the government bill introducing the changes, the bar association complained that no consultation had taken place.

A representative for the association also pointed out that the text of the bill does not define what ‘talent’ is.

Disy MP Harris Georgiades said he was favourably disposed toward the government proposal, but likewise grumbled that the president had unveiled the tax incentives scheme before it was ever shown to parliament.

Akel had some criticisms of their own, with Aristos Damianou asking the attorney-general’s office whether the incentives to expats would create an uneven playing field among Cypriot nationals.

His colleague Andreas Kafkalias noted that the government did not submit along with the legislation an impact assessment for the current incentives scheme.

“So we wonder which research and which data pointed to the need for these changes now,” he remarked.

Christos Christofides, another MP from Akel, said no one disagrees with the idea of bringing good scientists to Cyprus.

“But we should also see how we can keep here all those very good scientists who come and work for €800 to €1,000 and are unable to find dignified employment.”

The scheme’s stated strategy is to reverse the so-called ‘brain drain’ and attract top talent in science, technology and finance, all key components of Stem (science, technology, engineering and maths).