The inclusion of Cyprus in the list of countries with a preferential tax regime by the Greek Republic does not affect the trade and economic relations between the two countries, nor the business activities between Cypriot and Greek companies.
The text discusses a proposal to fully suspend VAT on houses in Cyprus, similar to Greece’s 0% VAT rate on new homes. The author recommends a temporary suspension of VAT or a super-reduced VAT rate for homes used as the main residence. The author also suggests revising the policy to include home size criteria and family size. The potential benefits of this policy include a surge in demand and supply for newly built properties, stabilizing prices faster, making resale properties more affordable, and correcting rental values. The author also proposes revising the definition of “new” and “old” properties and increasing transfer fees for second property purchases to compensate for the temporary VAT loss. The author argues that adjusting VAT for homes can support citizens in affording homes without negatively impacting public finances and can enhance both individual well-being and overall economic stability.
The content of the text discusses the challenges and opportunities that Cypriot businesses will face in 2024 due to the increasing importance of environmental, social, and governance (ESG) policies in Europe’s regulatory landscape. The European Council has approved a directive proposal outlining regulations for the period between 2024 and 2028. Large public-interest companies will be required to comply with non-financial reporting directives starting from January 1, 2024. From January 1, 2025, large companies not currently subject to the directive will also need to comply. Listed SMEs and other undertakings must comply from January 1, 2026, with the option for SMEs to opt-out until 2028. The adoption and adjustment to ESG principles are seen as crucial for economic resilience and maintaining a positive global reputation for Cyprus. ESG criteria are becoming an important tool for investors when assessing the sustainability and ethical impact of potential investments. The utilization of ESG criteria is evolving into an increasingly important pillar of the investment process. Investments embedding ESG criteria are estimated to exceed trillion by 2025. The adoption of ESG criteria plays a crucial role in the ratings of Cyprus’ economy. Concerns include the phenomenon of ‘greenwashing’ where companies overpromote their “green” credentials, misleading consumers and undermining trust. Standardization and regulation of ESG reporting are lacking, and stakeholders are called upon to address the issue.
A landmark EU law will ban the sale of goods linked to deforestation, one of the causes of climate change. Importers of coffee in the European Union are already reducing purchases from small farmers in Africa as they prepare for the law, which will come into effect in late 2024. The cost and difficulty of complying with the EU regulation on deforestation is expected to have a serious side effects that could reshape global commodity markets over time. Four companies have already stopped ordering coffee from Ethiopia, a decision that will have negative consequences for around 5 million rural families who rely on coffee cultivation. The law requires importers to prove that their raw materials do not come from deforested land or face high fines. The European Commission has launched several initiatives to help producing countries and smallholders comply with the law. However, some smallholders are struggling to collect the required data in time. The law is expected to increase food prices in the EU, but the European Commission stated that it will not lead to inflation.