At the end of October, the government is expected to announce the measures it is working on to alleviate the accuracy, while at the beginning of 2024, the new green taxation is expected to be implemented in fuel, along with compensatory measures, announced the Minister of Finance, Makis Keraynos, during the delivery of the 2024 budget to the Speaker of the Parliament.
“I am handing you the first budget of the government of Nikos Christodoulidis. It is a surplus budget, which should help us keep our economy on a sustainable and developmental path”, the Minister told the Speaker of the Parliament, Annita Dimitriou.
As he noted, the budget includes increased social costs and increased development costs, “so that we can implement development projects, which will ensure the sustainable course of our economy and also our obligations towards our social partners, the European Commission”. as he said.
He also said that the budget was made weighing the uncertainty that exists in the economic climate in the EU today. “I am sure that it will be a budget that will contribute to further addressing the economic and social problems that exist,” he added.
He noted that the implementation of the Resilience and Recovery Plan is one of the priorities of the budget, while the restructuring included in the budget “must be done for a modernization of the state, structures, institutions”.
Asked about the implementation of green taxation on petroleum products, he said that the green transition is one of the government's priorities and many individual items related to the green transition are included in the budget and the Resilience and Recovery Plan.
He also noted that it is an issue that is being studied by the University of Cyprus, which has been assigned tax reform, and it is expected that green taxation will be one of the first deliverables towards the end of the year, as well as the issue of compensatory measures, as , as he said, “we want the result to be neutral”. Mr. Keravnos stated that the taxation will be implemented in early 2024, as well as the compensatory measures.
Then asked about measures to deal with the accuracy considered by the government, the Minister said that by the end of October “we hope that we will be ready to announce them”, without specifying in which direction they will move.
For her part, the Speaker of the House assured that the House of Representatives will fulfill its role to the fullest. “The passing of the budget is the supreme legislative act,” he said, noting that the relevant parliamentary committee, the Finance Committee, is already working diligently in this direction.S
He noted that the debate and the passing of the budget will be completed around mid-December.
“The primary thing is to maintain financial stability, targeted economic policy. To be able, hence the upgrade we have had in the last few days, to keep this stable course of the economy that we so need, in an admittedly difficult politically and economically period, not only for Cyprus, but also for Europe and for the whole world”, noted Mrs. Dimitriou.
He added that “we want a prudent fiscal policy, with targeted measures”, also mentioning that “under no circumstances should we go back to policies that cost the state, the place and the citizens. That is why we consider it so important to table and vote the budget, exercising exactly the role we are obliged to do as Parliament”.
In response to when the discussion of the budget in the relevant Finance Committee, Ms. Dimitriou stated that the discussion begins immediately.
According to what the Minister of Finance stated during the approval of the Budget by the Council of Ministers, the development costs of the budget will be increased by 12% compared to 2023 and amount to €1.47 billion.
In addition, he had noted that social benefits are increased by 15% and amount to about €2 billion compared to €1.7 billion in 2023. Social welfare benefits increase by €56 million, health benefits by €150 million, education benefits by €10 million, and benefits to Local Government Authorities increase by €22 million. is the containment of the state payroll, hence only 52 new positions are included, compared to 485 in 2023.
Based on the Strategic Fiscal Policy Framework 2024-2026, the which sets the spending limits at the base of the policy statement, the fiscal balance was projected to show a surplus of €714 million or 2.3% of GDP in 2024, while the primary balance (excluding debt servicing costs) was projected to rise to €1.1 billion or 3.7% of GDP. Public debt is estimated to stand at 81.1% of GDP at the end of 2023 and further decline to 73% in 2024. The expenditure limit for the Central Government (primary expenditure for Independent Services, Ministries, Deputy Ministries and the General Accounting Office, including the Parliament) was set at €9.38 billion.