From €70.9 million in funding received by municipalities from the state last year, the reform of Local Government, which will be implemented from July 1st, will raise it to €92.9 million.
With the reform of Local Government, the number of municipalities will be reduced to 20 from the current 30, however, state funding is increased by €22 million, while it is expected to further increase to €117 million by 2025.
It is worth noting that in the first half of 2024, the state funding that the 30 municipalities will receive amounts to €35.4 million.
An amount of €8.7 million concerns funding in exchange for the abolition of the professional tax, while an amount of €1.09 million concerns funds in exchange for the Diapylia, which have been abolished for decades.
From July to December, the 20 municipalities to be established under the reform will receive a total of €58.8 million.
It is worth noting that the funding will be distributed to the new municipalities based on specific criteria, related to the population, population density, area, per capita income of the municipality from its residents, etc.
The Ministry of Interior estimates that the new distribution of state funding to municipalities will bring about fiscal balance, as it will be based on the needs of each local authority.
Specifically, the total funding of €58.5 million will be distributed to the 29 municipalities as follows:
- Nicosia Municipality will receive state funding of €9 million, Limassol €8.1 million, Strovolos €4.9 million, Larnaca €4.8 million, Lakatamia will be allocated €3.1 million, Paphos €2.8 million, Paralimni-Deryneia €2.58 million, Eastern Limassol €2.54 million, Latsia-Yeri €2.26 million, Western Limassol €2.24 million, Ayia Napa €2.1 million, Aradippou Municipality €1.8 million, Southern Nicosia-Idalion €1.8 million, Dromolaxia-Menou €1.6 million, Eastern Paphos €1.4 million, Chrysochous Town €1.24 million, Athienou €1.13 million, Akamas €1.15 million, and Lefkara €1 million.
Municipal funding. local government reform, state funding, municipalities