Cyprus Government Announces €60 Million Support Package to Combat Inflation

Cyprus Government Announces €60 Million Support Package to Combat Inflation

On February 21, the Cabinet of Ministers of the Republic of Cyprus approved seven measures to support the population and businesses in the fight against inflation. 60 million euros will be allocated from the state budget for this purpose.

President of the Republic Nicos Christodoulides announced the decisions in a televised address to the nation.

The measures include:

  • Extension of the electricity bill subsidy until April 30, 2024. For vulnerable groups, the subsidy will cover 100% of the increase in electricity prices.
  • Extension of the reduced excise duties on gasoline and diesel until March 31, 2024.
  • One-off support for families receiving social benefits based on income criteria. The maximum amount will be €250 per child. Families with more than four dependent children will receive additional money.
  • Increase in state subsidies for the purchase of electric vehicles to €2 million in order to support families with many children.
  • A package of measures for refugees from the occupied north of the island and their children and grandchildren: increased mortgage and home renovation subsidies, additional benefits for students.
  • Cancellation of the annual €350 fee for companies introduced in 2011 to support businesses.
  • The reduced or zero VAT rate on essential goods will be extended until the end of May.

The government expects that these measures will help to mitigate the impact of inflation on households and businesses.

The measures have been welcomed by trade unions and business associations.

However, some economists have warned that the measures may not be enough to offset the impact of rising prices.

It remains to be seen how effective the measures will be in containing inflation.

The government has said that it will continue to monitor the situation and take further measures if necessary.

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