**Cyprus Prepares Fresh Cost-of-Living Measures as Pressure on Households Persists**
The government of Cyprus is actively working on new measures to address the ongoing rise in the cost of living, as many households continue to feel the financial strain. The Finance Ministry announced on Monday that it is closely monitoring geopolitical developments and their effects on the economy and households, ensuring that any new initiatives do not jeopardize public finances or the country’s commitments to the European Union.
In recent months, the government has implemented a series of measures aimed at supporting vulnerable groups within the population. These measures include the application of zero Value Added Tax (VAT) on essential products such as fresh fruits and vegetables, meat, poultry, fish, baby formula, and hygiene products for both children and adults. Additionally, a reduced VAT rate of 5% on electricity is currently benefiting approximately 33,000 low-income households and single-parent families.
To further alleviate financial pressures, the government has also reduced the excise duty on motor fuels by 8.33 cents per litre. Other initiatives include an increase in child benefits and a widening of income thresholds for eligibility. These actions are part of a broader tax reform strategy that has raised the tax-free income threshold to €22,000 and introduced additional tax deductions for workers and households.
The Finance Ministry characterized these measures as a reflection of the government’s commitment to responsible economic management, which has resulted in fiscal surpluses and a reduction in public debt. The ministry emphasized that the benefits of this economic policy are being transferred to the society at large.
In light of ongoing public concern regarding the rising cost of living, Finance Minister Makis Keravnos indicated that a new package of measures is being prepared for submission to the Council of Ministers. He acknowledged the public's frustrations and the protests that have arisen as a result, stating that while the government respects the right to protest, it is actively working to address the issues at hand.
The ministry reiterated that the government is not remaining passive in the face of criticism, and it is committed to doing everything possible to respond to the needs of the population while adhering to sound fiscal principles and European obligations.
As the situation evolves, the Cyprus government appears determined to continue its efforts to support households facing economic challenges, with further measures expected to be announced in the near future.