Government extends zero VAT on essential products; adds coffee, sugar

The Cabinet decided to extend the zero VAT rate measure on essential products for an additional six months, adding coffee and sugar to the list.

List of products with zero VAT

  • Bread: All types of fresh or frozen bread, with or without yeast (e.g., white, brown, whole wheat, multi-seed, village-style, baguette, ciabatta, pitta bread, slices, rolls). Excluded are pastries and any bread with added ingredients such as raisins, dried fruits, or flavourings.
  • Milk: Fresh milk (e.g., cow’s, goat’s, sheep’s), sweetened milk, condensed milk, long-life milk, flavored milk (e.g., chocolate, banana), plant-based milk (e.g., almond, soy, rice).
  • Baby food: In powder, dry, or liquid form intended for consumption by children. Snacks (e.g., chips, nuts, candies, chocolates, ice cream) are not included.
  • Baby diapers
  • Eggs
  • Female hygiene products (tampons, sanitary napkins, and incontinence pads)
  • Adult diapers

Targeted Measures

When asked if there were considerations for subsidising electricity and fuel, Finance Minister Makis Keravnos reiterated the government’s focus on implementing targeted measures.

“The government’s policy is focused on targeted measures, which are not only more effective but also align better with the fiscal framework and fiscal discipline we need as a country to maintain our economic stability,” Keravnos stressed.

Highlighting the extension of the zero VAT rate, Keravnos added that the government is sensitive to the needs of the people, stressing its people-centric approach.

Read more:

VAT exemption of essential goods comes into effect today