Cyprus’s planned cut to fuel excise tax will come into force on 4 April rather than 2 April, the House Finance Committee heard on Thursday, as lawmakers pressed the government over whether the relief would reach consumers in full.
The measure, submitted to parliament as urgent legislation, is due to go to a full plenary vote on Thursday. If passed and published in the Official Gazette on Friday, it will take effect from midnight on Saturday.
The two-day delay was necessary to give fuel companies time to adjust their prices, according to Nayia Symeonidou, head of the Tax Policy Unit at the Ministry of Finance.
The cut reduces excise duty by 8.33 cents per litre on petrol and 6 cents per litre on diesel.
Symeonidou said the measure was designed to counter rising fuel prices driven by the war in the Middle East, and follows Eurogroup recommendations that support measures be temporary and limited in scope.
It will remain in force until the end of June and will then be reassessed. The total cost to the state is estimated at €18.6 million.
Symeonidou also reminded the committee that a separate measure reducing VAT on electricity to 5% for all domestic consumers had already been published by decree last Friday and will apply from 1 May 2026 to 31 March 2027.
Committee chair and DIKO MP Christiana Erotokritou raised concern about whether the fuel tax reduction would be passed on to consumers immediately and in full, warning against profiteering.
Symeonidou said the Consumer Service was monitoring implementation and that complaints and potential sanctions fell under the Ministry of Commerce’s remit.
Erotokritou said DIKO would call on the Ministry of Commerce to step up checks, describing those who sought to profit from a measure that deprived the state of revenue as doubly culpable.
AKEL MP Christos Christofidis argued that profiteering was already evident in the way international price rises were passed on to consumers immediately, while cuts were often delayed on the grounds of existing stock.
DISY MP Savia Orfanidou asked whether the government had assessed applying a zero VAT rate to specific products as a more targeted alternative.
Symeonidou said available evidence suggested the reduction was being passed on to consumers and that prices were being monitored systematically.
She added that the measure’s temporary, renewable nature was precisely intended to allow an assessment at each stage of whether consumers were the ultimate beneficiaries.
(information from CNA)
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