The President of the Republic announced the new measures against inflation through a televised message. Here is his message:
“Fellow citizens,
Being well aware of the challenges faced by households and businesses in October 2023, we announced a comprehensive support package totalling 196 million euros, which included, among other things, the gradual subsidy of the increase in electricity costs, the reduction of special fuel consumption tax rates, the application of a zero VAT rate on essential goods, the extension of allowances and one-off support for our vulnerable compatriots, as well as medium-term measures aimed at finding permanent and sustainable solutions to reduce energy costs and ensure affordable housing.
All of the above could be announced thanks to the responsible fiscal policy we follow and our unwavering commitment to creating conditions for sustainable development that allow us to pursue targeted social policies aimed at improving the daily lives of citizens and enhancing the competitiveness of businesses.
As I mentioned on October 19, 2023, during the presentation of the first support package, only through such responsible approaches, away from populism and wishful thinking, we can ensure development, progress, security, and, consequently, the government’s ability to exercise effective and targeted social policy.
Friends,
Today, responding to the needs of households and businesses, and always within the framework of fiscal responsibility, I announce a new package of targeted measures. Specifically:
- Extension of the graduated subsidy measure for electricity costs from March 1 to April 30, 2024, for household, commercial, and industrial consumers, while for vulnerable consumers, the subsidy will cover 100% of the increase in electricity prices.
- Extension of the measure to reduce consumption tax on motor fuels until March 31, 2024.
- One-off support for households receiving relevant allowances from the Ministry of Social Solidarity based on income criteria. Specifically:
A. One-off support for each child, with a maximum amount of 250 euros, in single-parent families. Families with more than 4 dependent children will receive an additional amount.
B. One-off support for each child, with a maximum amount of 250 euros, in families. Families with more than 4 dependent children will receive an additional amount.
C. Households receiving Minimum Guaranteed Income and not included in the aforementioned categories will receive a corresponding one-off amount.
These measures will benefit more than 27,000 families.
- To support large families and considering the significant interest shown in purchasing electric vehicles through the recently announced electric mobility grant program, we are increasing the relevant budget by 2 million euros.
- Specifically for the refugee population, expanding the beneficiaries and increasing the amounts in relation to the Central Body for Equitable Distribution of Burdens Plans. More specifically:
A. Increasing housing loan subsidies from 130,000 to 200,000 euros and the subsidy period from 20 to 30 years, with the elimination of income criteria.
B. Increasing subsidies from 50,000 to 100,000 euros for home repairs without income criteria.
C. Increasing subsidies for students to include maintenance expenses, in addition to tuition fees, while at the same time the scholarship amount will not be deducted from the student loan amount as it was until today.
D. New loan schemes for home renovation, purchase of household appliances, and energy upgrades in existing homes, without income criteria.
E. Expanding beneficiaries of the Young Entrepreneurs Professional Activity Loan Scheme.
F. For properties in occupied areas that were used for a loan, which was subsequently repaid, it can now be reused in a relevant application to the Central Body for Equitable Distribution of Burdens.
G. Loan or interest subsidy schemes provided by the Body will no longer be counted.
H. For Housing Loan applications, it will not be considered if applicants have another owned residence unless they have been approved in the past by the Body for that specific residence.
- For additional relief and support for businesses, the annual company fee of 350 euros imposed in 2011 will be abolished.
- At the same time, I remind you that the reduced or zero VAT rate on essential goods will continue until the end of May.
Finally, it is noted that the Housing Loan Interest Subsidy Scheme for the purchase and construction of a primary residence that we announced in October 2023 has received approval from the European Commission and is immediately effective.
Friends,
In October 2023, we announced a package of measures totaling 196 million euros. The new package of targeted measures I announced today, which exceeds 60 million euros without taking into account the support amount from the Central Body for Equitable Distribution of Burdens that we announced today, is within our fiscal capabilities and based on the stable developmental path of the Cypriot economy. I want to reiterate once again that our actions aim to strengthen the social protection network of our vulnerable compatriots and support the middle class.
We continue our great effort with specific goals, a plan, and determination. Above all, with responsibility, persistence, and a people-centered approach for the Cyprus we desire.
Thank you very much.”