Parliamentary discussion has started on the state Budget for 2007 with coalition and opposition parties trying to grab as many votes as possible ahead of the presidential elections in 2008.
The workers’ party of AKEL and the middle-class representative DISY want to hike the tax-free allowance of low-income families to CYP 12,000 (EUR 20500), which the government has rejected through the ruling party DIKO, warning the public sector deficit would skyrocket by 25%.
The socialist EDEK also wants to raise the tax-free ceiling, but for different reasons as it modernizes its political platform and tries to grab as much support from the middle classes.
This is not what the Papadopoulos administration wants while maintaining a sound fiscal policy in order to secure Eurozone entry by January 1, 2008.
But what the debate is obviously missing is any talk of improved tax collection, as well as further (or at least continued) budget cuts, as no one wants to upset the 25,000-or-so high-income civil servants who can muscle their voting power 16 months ahead of the polls, as they have done prior to previous elections.
No one has caught on to the fact that more than three years into the present ‘administration of change’, all the new social and infrastructure projects are now being released at a time when spending should have been contained.
The politicians are obviously telling the number-crunchers to squeeze as much voter-earning projects out of the tax pennies, as projects that were put on hold by the keepers of the state budget are now coming out of the drawers, ranging from (finally) proceeding with new roads to ambitious arts and culture projects in the pipeline, as if Cyprus has a surplus of cultural events. And all this time the opposition is day dreaming.
EDEK seem to have the only wise proposals as they want a comprehensive package to include tax-cuts as well as wider incentives for businesses, that, at the end of the day, are the high-earning sector of the economy that AKEL wants to tax in order to fund the lower-income earners.
Nobody wants to give anything back to the entrepreneurs who have driven the island’s economy for the past decades, and yet everybody is trying to lure their votes.
It is ironic that most of the members of the workers’ party are great capitalists; the concerns of the middle class are voiced by the socialists; and the main opposition party, supposedly the guardian of the middle class, is undecided if its wants to represent the white collars or blue collars among us.
Who, then, is looking after the tax-payer’s interests?
