The Cyprus government is preparing further measures to tackle the rising cost of living, while insisting it is already making full use of the options available without putting public finances or European obligations at risk.

The Finance Ministry said on Monday that it was assessing geopolitical developments and their impact on households on a daily basis, while a range of measures aimed particularly at vulnerable groups remained in force.

These include zero VAT on a number of basic products, including fresh fruit and vegetables, meat, poultry and fish, baby milk, nappies for children and adults and feminine hygiene products.

A reduced 5 per cent VAT rate on electricity is also applied to around 33,000 low-income households and single-parent families, according to the ministry.

The government has also cut excise duty on motor fuels by 8.33 cents per litre, while child benefit has been increased and its income thresholds widened.

At the same time, the ministry pointed to changes under the tax reform, including the increase in the tax-free income threshold to €22,000, alongside additional tax deductions for workers and households.

It said the measures represented the transfer to society of the benefits generated by what it described as responsible economic policy, fiscal surpluses and lower public debt.

The ministry added that further measures are already being prepared for submission to the Council of Ministers. Finance Minister Makis Keravnos also said earlier on Monday that a new package addressing the cost of living would be brought before cabinet.

On public criticism of the government’s response, the ministry said protests were a democratic right.

However, it said the government “is not remaining passive” and was “doing everything it can to respond”, while remaining within the limits imposed by sound public finances and Cyprus’ European commitments.