COVID-19: Measures by the Government of Cyprus

The World Health Organization (WHO) has declared the COVID-19 outbreak to be a pandemic. In Cyprus, the Government has announced several measures to support the economy of the country and restrict the spread of COVID-19. These measures include:

 

TAX

  • Extension of the submission deadline of income tax returns for two months i.e. the new deadline TD. 4 (Corporate Tax Returns) and TD. 1 (Personal Income Tax) for 2018 is now 31 May 2020.
  • Suspension of the rise in the General Health System (GESY) contributions by the employer and the employee for two months (April 2020 and May 2020).
  • There will be special arrangements for the taxpayers who have been included in the scheme regarding the settlement of overdue taxes.

 

VAT

  • Reduction in the Standard VAT rate from 19% to 17% for two months.
  • Reduction in the Reduced VAT rate from 9% to 7% for 3,5 months.
  • Suspension of the obligation for the VAT payment without any penalties for two months. This applies for:
    1. Businesses with turnover less than €1 million based on the VAT returns during 2019
    2. Businesses whose turnover has been reduced by more than 25%

 

Other Adjustments

  • Four weeks ‘special’ parental leave who work in the private sector with children aged up to 15. A parent with a salary of up to €2.500 for the first €1.000 will receive a 60% special leave allowance, while for the next €1.000 a 40% allowance will be paid. In the case of single-parent families, the ratio will be 70% and 50%, respectively. If the salary exceeds €2.500 then no special leave allowance is given.
  • A €750 allowance to students who will remain abroad during the Orthodox Easter holidays because of the measures.
  • The public service will operate with a safety staff and work will be done from home wherever possible. This comes into effect on Tuesday 17th March.
  • A price ceiling on items such as face masks and antiseptics to prevent profiteering.
  • Sick leave for those required to self-isolate or quarantine.

 

The following businesses were closed from Monday 16th March for four weeks:

  • Department stores and shopping malls. The same applies to shops irrespective of their nature or size inside shopping malls. Supermarkets inside shopping malls may remain open provided that special health safety measures are applied.
  • Restaurants, cafes (except those offering delivery services)
  • Clubs, cinemas, theatres, other entertainment centres, and amusement parks
  • Libraries
  • Museums and archaeological sites
  • Casinos and betting shops
  • Sporting establishments
  • Hairdressers and beauty salons
  • Hotels (operations suspended until 30 April 2020)

 

The following businesses will remain open:

  • Supermarkets (assuming no more than 1 person (including employees) per 8 square meters is present within the same area)
  • Pharmacies
  • Private medical centres
  • Food markets
  • Bakeries and confectionaries
  • Petrol stations
  • Kiosks

 

It is noted that retail businesses that do not fall under the category of businesses that must close, can continue their operations, as long as there are less than 5 employees in the workplace. Furthermore, for serving the public, all businesses of the private and public sector must ensure that no more than 1 person per 8 square meters is present in the reception area.

***The current situation regarding COVID-19 in Cyprus is subject to change. All the above amendments can be altered at any time by the Government.

For any questions or clarifications on the above announcements please contact us.