Accuracy in energy and food affects all economies. At European level, most governments – including Cyprus – have already announced a series of measures, mainly related to the temporary reduction of fuel taxes.
The announcement by the Prime Minister of Greece, Kyriakos Mitsotakis, of a package of 1.1 billion. covering 3.2 million citizens and households with incomes of up to 30,000 euros to mitigate the effects of accuracy, creates the temptation of comparison.
Which country has taken the most and most effective measures?
First of all, Greece and Cyprus are not comparable cases. Cyprus is in a much better fiscal position than Greece. In addition, the existing allowance policy in Cyprus is higher, with a focus on the Minimum Guaranteed Income.
The better fiscal position of Cyprus facilitates the implementation of more aggressive measures to reduce taxation as has already happened with the horizontal reduction in VAT on electricity consumption (from 19% to 10%) and the reduction of the Excise Tax on fuel. In addition, a 10% reduction in electricity is applied in agreement with the EAC.
Greece applies a multiple tax on fuel and today Cyprus has the lowest tax in the EU, resulting in 95 octane gasoline in Cyprus is 30% cheaper than in Greece.
It is no coincidence that in Greece the media make comparisons with Cyprus for fuel prices and cite it as an example.
A constant criticism in Greece is that the government (SYRIZA is talking about crumbs) could fund a larger anti-puncture intervention by using the increased tax revenues on fuel. The argument is not unfounded, but we must take into account in our analysis that Greece has the highest public debt in the eurozone. The regulation of the Greek debt keeps the cost of service low, but this regulation was made in order to reduce it more smoothly and not to keep you at high levels, over 200% of GDP.
Cyprus, as we mentioned, is one of the few countries that implements horizontal measures in electricity, for all consumers. For vulnerable groups, VAT on electricity is even lower at 5%.
Bills reaching households and businesses are high, but the average price of electricity in Europe is about three times higher than in Cyprus. < br /> The list of measures taken by Cyprus includes a 50% increase in the mountain allowance and the possibility of imposing a ceiling on grain prices.
In the field of RES and energy saving, Cyprus implements a larger program compared to Greece, in proportion to the population. This year, funds of 150 million euros will be allocated.