Cyprus property boom boosts tax receipts

Increased revenue from capital gains tax on property has been instrumental in boosting the Cyprus government’s revenue in the first nine months of 2007. The Inland Revenue Department reported that total revenue during the period January -September 2007 advanced by 44% YoY to CYP 860.4 mln.

Revenue from Capital Gains Tax surged by 153.5% YoY to CYP 199.4 mln on the back of the strong demand in the property market. Similarly, revenue from Corporation Tax advanced by 34.7% YoY to CYP 257.1 mln indicating a healthy business environment.

The increased Inland Revenue receipts recorded in the period underpins the Government’s increasing efficient tax collection mechanisms and provides positive signals to further improve the Budget deficit. According to last year’s estimates by the Ministry of Finance, Inland Revenue receipts were expected at CYP 783.3 mln for the whole year, which were subsequently revised to CYP 1.1 bln.